Climate Strategy
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Organizations have been under increasing pressure to respond to climate change, particularly in the last two decades. The strategic responses of firms have evolved over this time and have been shaped by a combination of regulatory, social and competitive forces.
SusTec research investigates how organizations develop strategies in response to climate change, how policy affects the strategies of firms even in the same sector in different ways, as well as how strategies influence innovation, environmental and financial performance.
Key findings:
- Household policies targeting efficient energy use, in particular financial subsidies and energy labels, significantly increase the number of patented energy-efficiency inventions (DownloadGirod, Stucki, and Woerter, 2017).
- Interpreting climate change as a threat encourages proactive responses from managers (DownloadHaney, 2015).
- In the banking sector, there is evidence of decoupling where the banks’ climate strategies are not linked to core business activities such as lending and investment (DownloadFurrer, Hamprecht and Hoffmann, 2012).
- The degree of regulatory uncertainty and the perception of exposure to future regulations determine the choice of climate strategies (DownloadEngau and Hoffmann, 2011).
- Absorptive capacity facilitates the development of proactive environmental strategies that result in competitive advantage (DownloadDelmas, Hoffmann and Kuss, 2011).
- GHG intensity rather than the response to individual stakeholder groups affects the choice of environmental strategy (DownloadSprengel and Busch, 2010).
- Regulatory uncertainty in climate policies did not necessarily lead firms to postpone investments (DownloadEngau and Hoffmann, 2009; DownloadHoffmann, Trautmann and Hamprecht, 2009).
- Among Swiss ski lift operators, for instance, the awareness of possible climate change effects has a positive influence on the scope of corporate adaptation (DownloadHoffmann, Sprengel et al., 2009)
- Among electricity producers, there is a wide range of approaches to climate strategy even though the companies face similar risks and challenges (DownloadWeinhofer and Hoffmann, 2008). Managers play a decisive role in choosing how the firm responds (DownloadWeinhofer and Busch, 2012).
- The EU Emissions Trading System (EU ETS) even in its early years had an influence on the investment decisions of firms. To have an effect on large-scale investments and R&D, however, policy needs to be clear on long-term reductions (DownloadHoffmann, 2007)
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