Business Leadership on Carbon Pricing
Global momentum is building for putting a price on carbon emissions as a necessary and effective measure to tackle the climate change challenge. Approximately 40 countries and more than 20 cities, states and provinces use carbon pricing mechanisms or are preparing to implement them. A growing number of business leaders are standing up in support of a price on carbon as an effective way to incentivize low-carbon growth and lower greenhouse gas emissions that are driving climate change.Yet greater leadership is needed if we are to limit global warming to 2 degrees Celsius
The UN Global Compact together with UNEP and UNFCCC secretariat and Caring for Climate strategic partners – CDP, The Climate Group, UN Foundation and Principles for Responsible Investment – are calling on companies to demonstrate leadership in pricing the cost of carbon emissions as a necessary and effective measure to tackle climate change. The Business Leadership Criteria on Carbon Pricing have been developed to inspire companies to reach the next level of climate performance, and to give recognition to businesses that are at the forefront of advocating for a price on carbon. The Business Leadership Criteria complement a Statement on Putting a Price on Carbon developed by the World Bank Group and other partners to call for countries and companies to demonstrate strong global support and action toward pricing carbon.
Business Leadership Criteria on Carbon Pricing
The Business Leadership Criteria on Carbon Pricing comprise three distinct but overlapping dimensions: integrating carbon pricing into long-term strategies and investment decisions, responsible policy advocacy, and communication on progress. All three dimensions of the criteria are aligned with limiting the increase in global mean temperature to 2° C above pre-industrial levels.
Consistent with the 2° C global target,companies are invited to indicate alignment with the following criteria:
- Set an internal carbon price high enough to materially affect investment decisions to drive down greenhouse gas emissions;
- Publicly advocate the importance of carbon pricing through policy mechanisms that take into account country specific economies and policy contexts; and
- Communicate on progress over time on the two criteria above in public corporate reports
Become a Carbon Pricing Champion
Companies that have aligned with the leadership criteria are considered Carbon Pricing Champions. Click here to see a list of Carbon Pricing Champion companies.
Carbon Pricing Champions will have recognition opportunities during milestone UN events in the lead up to the Caring for Climate Business Forum at COP21/CMP11.
How to Indicate Alignment with the Criteria
All companies are invited to align with the Business Leadership Criteria on Carbon Pricing. A company wishing to indicate alignment should:
- 1. Submit a signed letter stating the company’s support of the Business Leadership Criteria on Carbon Pricing and its commitment to align with the criteria. Click here to view a sample letter of support.
- 2. Send the signed letter to email@example.com.
Why Carbon Pricing?
Carbon pricing is a critical tool to address climate change, and momentum is building to put in place carbon pricing schemes. According to the World Bank Group, nearly 40 countries and more than 20 cities, states and provinces use carbon pricing mechanisms such as emissions trading systems and carbon taxes or are preparing to implement them. Many companies already operate in countries with carbon pricing and use an internal carbon price in their planning and investments; however more leadership is needed if we are to limit global warming to 2° C.
On 23 January 2014, the UN Secretary-General called for Global Compact LEAD and Caring for Climate chief executives to “become advocates for an effective, well-functioning carbon market” across the global economy, and urged business leaders to work with policymakers to advance this agenda. Nearly 400 companies through the Caring for Climate Leadership Statement call for “the urgent creation, in close consultation with business, community and civil society of long-term policies to create a stable price for carbon”.
For more information, please contact Jayoung Park (firstname.lastname@example.org).