GEMI Survey Climate Change

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GEMI SurveyClimate Change Where Do We Stand?

• March 2003

Carl Wirdak Occidental Petroleum Corporation
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Outline

• Survey Recap
• Strategies
• Goals
• Inventories
• Voluntary Initiatives
• External Organizations

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Survey Overview

• Survey addresses the topic of climate change as
  it applies to a companys business activities
• Survey response rate 50
• Augmented with information from other GEMI member
  websites (brings response to 75)
• Not all companies completed all questions
• Broad industry coverage
• Thank you to all participants!

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Strategy Overview

• Survey defined strategy broadly
• requires conscious decision to link current or
  future plans and action to the climate change
  issue, but
• no prescribed elements, format or scope
• 28 of 30 GEMI companies have or will have a
  climate change strategy within 2 years

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Strategy Basis

• Why do companies have a climate change strategy?

Science doesnt drive actions
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Strategy Elements

• Top tier no regrets actions
• Middle tier tough stuff that takes real to
  do
• Bottom tier mostly Kyoto driven, but since it
  hasnt been ratified

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Strategy Adoption

• Climate strategies are a recent phenomena
• In nearly every case, the strategy applies across
  the company
• Strategies sanctioned by Board 23

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Public Communication of Position

• Companies with a climate change strategy
  communicate their position
• Absence of discussion does not mean that there is
  no climate change strategy

No. of companies 30
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Goals
Type of goals

• 73 of the GEMI companies with a climate change
  strategy have associated goals
• Preference is for numeric goals
• 90 of those companies that have goals disclose
  them publicly

No. of companies 19
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Climate VISION

• Feb. 12, 2003 - Bush administration announces
  agreements in which companies will voluntarily
  meet targets to reduce, avoid, or sequester
  greenhouse gas emissions
• Climate VISION Climate, Voluntary Innovative
  Sector Initiatives Opportunities Now
• 16 GEMI companies indicated that they are part of
  an industry association that pledged support

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Inventories - Overview
Inventory
Baseline Year
gt85 of firms have inventories and most use
recent baselines
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Inventory - Gases
of GHGs in inventory

• Carbon dioxide is most common GHG in company
  inventories

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Inventories - Scope
Activities considered in inventory

• Electricity / energy production (direct and
  indirect) and processing are top categories
• Just over half of the companies that assemble a
  GHG inventory use a published protocol

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Voluntary Initiatives

• 24 of the 30 GEMI companies included in the
  survey participate in voluntary climate change
  initiatives

Climate VISION EPA Climate Leaders EPA Green
Power Partnership EPA WasteWise EPA SmartWay
Transport DOE 1605b BRT Climate RESOLVE
Pew Climate Change API climate initiative ACC
climate initiative Australian Greenhouse
Challenge Canada, UK, Netherlands programs NJDEP
GHG Action Plan
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Voluntary Programs - Incentives

• Whats in it for companies that participate in
  voluntary climate change programs?
• Enhances relationships with variety of external
  constituents
• Helps company learn how to deal with the specific
  issues
• Other benefits

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External Organizations

• Results of poll ranking 29 NGOs and other
  organizations
• Screened to show only those receiving votes from
  at least ½ of survey respondents
• Not helpful
• CERES
• Greenpeace

Not Helpful
Neutral
Helpful
U. S. Department of Energy 13 2 0
U. S. EPA 13 1 1
World Resources Institute 12 1 1
EPA Climate Leaders 10 3 0
WBCSD 8 2 1
Nature Conservancy 7 2 1
Pew Center 5 4 1
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Information Sources
What are the top web sites?
Common

• Dept. of Energy
• EPA
• GEMI
• World Resources Institute

• Pew Center
• WBCSD

• United Nations Environment Program

Less common
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External Inquiries

• Carbon Disclosure Project
• www.cdproject.net
• Target FTSE 500
• CEO was recipient
• SRI fund backing
• 24 of 30 GEMI companies received questionnaire

• Innovest Advisors - summary report
• Most companies (80) acknowledge risks
• Most have not informed shareholders of financial
  risks
• Companies that take steps to address climate
  change can mitigate losses and even gain
  competitive advantage

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Climate Change Nuggets

• Theres a rising tide of company climate
  strategies
• Resistance to goals is thawing
• Public disclosure is more than a bunch of hot
  air
• Most GHG baselines are frozen in year 2000
• GHG emissions inventories are a gas
• Companies have warmed-up to voluntary
  climate-related initiatives
• The heat is on from external organizations

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Closing Comments

• Questions / comments / discussion
• June benchmarking will look at EHS information
  management systems