Last month, President Biden announced a bold acceleration of U.S. climate goals with a new commitment to slash greenhouse gas emissions in half by 2030. Encouraging the move were hundreds of major corporations, who signed a letter to the President beforehand imploring him to establish a new tone on climate.
“If you raise the bar on our national ambition, we will raise our own ambition to move the U.S. forward on this journey,” wrote a group of more than 400 businesses and investors, including giants like Apple, Verizon, and Unilever (not to mention mid-sized companies like the one I lead).
Biden has said he’ll do his part. Now it’s time for corporations to do the same.
For all the companies that signed the letter, many more remain silent—and on the sidelines—in the face of a climate crisis. In fact, 70% of Global Fortune 500 companies still don’t have a meaningful climate plan designed to achieve or be well on the way to net-zero emissions by 2030, when scientists say climate change could be irreversible.
We call it a climate crisis, but it’s also a crisis for business. As a CEO operating in a world already facing destabilizing climate impacts, it amazes me that so many companies haven’t planned for a future that is already here. Inaction presents a direct and perilous threat to the world’s most valuable companies and their shareholders—not to mention the rest of us.
After all, in the year 2021, if you don’t have a climate plan, you don’t have a business plan.
This isn’t a political talking point. While too many of the world’s biggest companies still lack meaningful climate plans, 30% have made climate action their business (up a third compared to last year). Their leaders are clear-eyed and optimistic about the unprecedented bottom-line growth opportunities for those who wisely choose to participate in the new clean energy economy—driven by innovative new products and emerging markets, the ever-dropping price of clean energy, huge energy efficiencies, and resiliency to climate-induced disruptions.
Investors know smart investments when they see them. Long-term investment in aggressive climate action represents one of the best ways for large companies to create long-term shareholder value, regain a position of unmatched economic strength among rivals like China, and build a valuable reputation for supporting prosperous, healthy communities grounded in millions of new jobs in the clean energy sector.
But the door of opportunity for climate planning—and the economic winnings that bold action will generate—is closing fast. As we say in the beer industry, this is the “last call.” So how can businesses catch up?
First, investors—just like customers—need to double down on recent momentum toward making climate action a chief funding criterion, with a special emphasis on reserving capital for companies that have established a strong 2030 climate action plan. And let’s start asking those who don’t: Why not? If the clear business case for addressing climate change doesn’t break through, a surge in outside pressure just might.
Second, just as we need a 2030 climate plan from every large business, we need vocal advocacy from businesses to get the job done for the nation as a whole. It’s exciting to see the Biden administration setting an ambitious climate target, rallying world leaders to follow suit, and championing federal investments in climate solutions as a vital path to a robust—and equitable—economic recovery. But it doesn’t mean much unless Congress can pass bills to make the massive investments in green infrastructure and clean technology required to transform our economy and help supercharge the business growth opportunities I describe.
Business leaders have influence in Congress—especially those who lead the nation’s largest companies. I urge major corporations to advocate for their own long-term interests by encouraging members of both parties to pass an infrastructure package packed with climate solutions, good-paying jobs, and strong equity measures to account for the disproportionate impacts of climate change on marginalized communities. Here, again, we need to start asking companies who aren’t willing to pick up the phone: Why not?
(Yes, this means my fellow CEOs need to accept new federal policy as it is critical in creating systemic change. But the door is wide open for us to play a vital role in its development and ensure new rules work as intended and promote fairness among leaders and laggards alike.)
Third, we need businesses to accelerate the path to net zero simultaneously with federal action—not wait around for it. It’s time for the leaders of 70% of Global Fortune 500 companies lacking a 2030 climate plan to embrace the incredible opportunity a new economy—and the potentially fatal risks of moving too slow—and make climate action their business. Now. Before the barkeep kicks them out.
Steve Fechheimer is the CEO of New Belgium Brewing.