HEC Climate Days: Discussing tools and mechanisms for climate action
The need to tackle climate change has created massive challenges for businesses and policymakers. The Climate Days organized on the HEC campus on May 30th and 31th brought together actors from the corporate, political, and academic world as well as the civil society to discuss potential solutions to these challenges.
The event, organized by Daniel Halbheer, Associate Professor of Marketing and Holder of the FII Institute Chair on Business Models for the Circular Economy and Igor Shishlov, Climate Policy Consultant at Perspectives and HEC Lecturer on Climate Change Economics, was the culmination of the Climate & Business Certificate, a new flagship program at HEC Paris.
Kicking off the event, HEC Dean Eloïc Peyrache urged to focus on solutions rather than talking about climate problems. “Believing in science and looking at solutions is really in the DNA of an academic institution like HEC (…), it's also in the DNA of the people who are invited during these Climate Days,” he said. And indeed the 37 speakers who participated in the two-day event brought science-based arguments, facts and figures, practical examples, and personal experiences to the table to discuss various aspects of decarbonization.
Why we need to put a value on carbon
The keynote speaker was Christian Gollier, a professor at the Toulouse School of Economics and contributor to IPCC reports. Examining the economics of climate change, he first explained the mechanics behind our inertia:
- Externalities: if you emit CO2, you benefit from cheap energy but are damaging the future, whereas if you reduce emissions and therefore reduce future damage, you bear the sacrifice but do not enjoy the future benefits.
- The tragedy of the horizons: we are desperately short-termist, even “democracies are in a dictatorship of the present”.
- Carbon leakage: if you penalize carbon emitters, they will move across the border, along with jobs.
Professor Gollier then sketched out ideas on how to translate our responsibility towards future generations into an operational framework to help policymakers and society more broadly decide what is desirable in terms of sacrifices. For sacrifices there will be, he warned, although politicians shy away from the “blood, sweat and tears” language of truth. While there are many ways of reducing emissions, it is not just a matter of “this is green, let's do it” as Professor Gollier said. Some actions are costlier than others, so policy-makers need to put a value on every ton of carbon saved to perform a cost-benefit analysis and decide which action to perform or not.
Getting all stakeholders on board
The first question addressed to the next speaker, EU Member of Parliament Pascal Canfin, concerned regulation. As chairman of the Environment Committee, he emphasized the “massive change” represented by the EU Green Deal, a package of more than 50 rules to make Europe climate neutral by 2050 – in the timeframe of one generation.
He recalled three key aspects regarding the laws connecting financial regulation and climate action:
- The need for proper taxonomy and disclosure regulation to have transparent data.
- The need to move from the systematic risk represented by climate change to a micro-risk approach.
- Changing the assessment of the value of a company to take into account their carbon impact.
Regarding carbon pricing, Pascal Canfin explained that it had to be used as part of a wider toolbox, in combination with regulation, and only when it made sense to drive change. While carbon pricing makes sense for the cement industry, for instance, it won't work for the car industry, hence the need for “old-school standards and regulations” instead (notably the law banning the sale of new thermic cars after 2035). He also argued that carbon pricing was “socially regressive” for households and carried the risk of losing social acceptance for the green transition.
As a counterpoint to this political perspective, the microphone went to Mike Rosenberg, professor of management at IESE business school, who expressed his strong belief that innovative solutions would come from business.
NGOs such as the advocacy group Reclaim Finance – that was represented by the Founder and Executive Director Lucie Pinson – can play a critical role pushing for the change in the rules of the game within companies and at EU level.
A strong message about workers applying internal leverage to put companies on a sustainability path was expressed by Quentin Bordet, a spokesman for Les Collectifs, a network acting for ecology in the workplace, and Yannick Servant, from the Convention Entreprises Climat, which brings together 150 companies together to devise practical roadmaps for objectives.
Watch the video: ENGAGING STAKEHOLDERS FOR CLIMATE ACTION
Panel discussion with Quentin Bordet, BCG, Spokesman Les Collectifs; Pascal Canfin, Chair of the Environment Committee of the European Parliament; Lucie Pinson, Founder and Executive Director at Reclaim Finance; Yannick Servant, Co-Founder Convention Entreprises Climat and Mike Rosenberg, Professor of Management at IESE Business School.
Moderator: Katell Le Goulven, Executive Director of the Hoffmann Global Institute for Business and Society at INSEAD
The afternoon of the first day was devoted to a research workshop, opened by Professor Rodolphe Durand and moderated by Daniel Halbheer, and featured six academic presentations:
• Sam Aflaki, Professor of Operations Management at HEC Paris
• Patricia Crifo, Professor at École Polytechnique and CNRS Researcher
• Augustin Landier, Professor of Finance at HEC Paris
• Luc Paugam, Associate Professor of Accounting at HEC Paris
• Bertrand Quélin, Professor of Strategy at HEC Paris
• Armin Steinbach, Professor of Law at HEC Paris
Net zero strategies and carbon offsetting: real transformation or greenwashing?
The second day's first two panels debated the issues around the corporate net zero strategies and offsetting. According to the Corporate Climate Responsibility Monitor that assessed the transparency and integrity of 25 companies’ emission reduction and “net-zero” only one had proven “reasonable ambition”. Carbon offsets that are usually part of the net zero strategies represent emissions stored, absorbed or avoided by a given project, such as reforestation or renewable energy. The value of the market for offsetting projects has exceeded 1 billion euros in 2021 and is growing fast driven by the corporate demand.
But does it really contribute to net zero or is it just an excuse to continue business as usual? These are some of the issues discussed in the morning panels.
Watch the video: NET ZERO STRATEGIES: REAL TRANSFORMATION OR GREENWASHING?
Panel discussion with Marie-Pierre Bousquet Lecomte, Science-Based Targets implementation Director at Danone, Rémi Bussac, Senior Policy Advisor - Climate & Sustainable Development at EDF, Clément Tremblay, Responsable climat Groupe at ENGIE, and David Meneses, Executive Vice President Sustainability at Plastic Omnium.
Moderator: César Dugast, Manager at Carbone 4
Watch the video: CARBON OFFSETTING: CAN YOU BUY INDULGENCE?
Panel discussion with Vincent Loubinoux, Business Development Manager at ClimateSeed, Lénaïc Pineau, Group Chief Sustainability and Quality Officer at JCDecaux, and Myrto Tilianaki, Climate Justice advocacy officer at CCFD-Terre Solidaire, and Christian Didier, Climate Finance Expert.
Moderator: Igor Shishlov, Academic Co-Director of the HEC Climate and Business Certificate
The role of entrepreneurs and climate leaders
Technological advances may not save us, yet some entrepreneurs are designing surprisingly green innovations, as exemplified with representatives of two companies: HD Rain, which offers detailed weather forecasts and measurements, and GenoMines, which genetically enhance metal hyperaccumulator plants to produce bio-sourced metals and limit the environmental impact of mining groups.
Watch the video : INNOVATION FOR CLIMATE: WHAT IS THE ROLE OF ENTREPRENEURS?
Panel discussion with Emma France, Director of Impact Entrepreneurship programs at HEC, Ruben Hallali, co-founder & CEO of HD Rain, Fabien Koutchekian, co-founder & CEO of GenoMines, and Aymeric Penven, Creative Destruction Lab.
Moderator: Laurence Lehmann-Ortega, Professor of Strategy at HEC Paris (Education Track)
The last panel discussion was about climate leadership. Hacina Py, Chief Sustainability Officer at Société Générale, explained that they require their clients to align their projects with their own targets. Gwenaelle Avice-Huet, Head of Strategy and Sustainability at Schneider Electric, talked about the need to embark people on her journey.
Watch the video: HOW TO BE A CLIMATE LEADER IN YOUR BUSINESS?
Panel discussion with Hacina Py, Chief Sustainability Officer at Société Générale and Gwenaelle Avice-Huet, Head of Strategy and Sustainability at Schneider Electric. Nikolaos Kordevas, from KPMG and Karen Lemasson from Expanscience. Moderator: Jean-Michel Gauthier, Professor of Finance at HEC Paris (Education Track)
Funding of the event by the FII Institute Chair on Business Models for the Circular Economy is gratefully acknowledged.