Climate crisis requires boards to put climate transition at the heart of corporate strategy, says international network of board directors
As the global UN COP26 climate talks commence in Glasgow, the international Climate Governance Initiative (CGI) has called on board directors across the world to place the climate transition at the heart of corporate strategy and board decision-making. In a statement released today, the CGI points to warnings from Mark Carney and others that the climate crisis poses the ‘single greatest threat to global financial stability’ and urges board directors to rapidly skill up in order to confront the climate emergency.
Set up in association with the World Economic Forum in 2019, the Climate Governance Initiative network represents over 100,000 board directors across more than 20 major economies, with the capability to influence trillions of dollars of capital through the companies they serve.
The statement notes that the impact of the climate crisis ‘will be felt by all companies, posing major short, medium and long-term risks and requiring boards to put climate change at the heart of their strategy, risk management and disclosure processes.’
It calls on board directors to ‘play a part in the global response to climate change’, emphasising the critical role of board directors in the transition to a net-zero future.
Karina Litvack, Chairman of the Climate Governance Initiative said:
“We welcome the fact that growing numbers of directors around the world have understood the gravity of the climate crisis and have committed to taking a leadership role in improving climate governance on their boards. We represent an important new wave of climate champions who have significant influence, and we are ready to step up to accelerate the pace of change needed to deliver a net-zero economy in our lifetime.”
The Climate Governance Initiative statement states that ‘now is a crucial time for boards to be engaging with the impacts of climate change and making long-term plans for the future. This includes ensuring that their business strategy is resilient in a zero emissions future and the executive team has the skills to deliver it.’ The Climate Governance Initiative gives board directors the skills they need to advocate for their companies to accelerate their net-zero journey, by drawing on the eight Climate Governance Principles published by the World Economic Forum.
Local director networks that make up the Climate Governance Initiative, known as Chapters, are ‘building a community of climate conscious directors who are committed to developing the skills, processes and understanding necessary for them to fulfil their fiduciary duties in the long-term service of their organisations.’
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