How climate change is impacting L&D

by John Hilton05 Feb 2016
In Australia, there are only a small number of companies using L&D initiatives and energy efficient policies to address climate change, according to Christopher Wright, Professor of Organisational Studies at the University of Sydney Business School, and author of the book Climate Change, Capitalism and Corporations: Processes of Creative Self-destruction.

Indeed, these companies are generally focused on climate change as a risk and as an opportunity, he told L&D Professional.

This is in terms of issues such as regulatory risk, carbon pricing and market risk (disruptive technology and the move to renewables), reputational risk (changing public perceptions of climate change and the impact for their investments or products), not to mention employee attitudes, he said.

Moreover, Wright added that these businesses have generally invested in culture change initiatives around environmental sustainability.

“That involves training employees not so much around climate change per se, but around energy efficiency,” he said.

“They set up, for instance, what they call carbon committees where employees come up with ideas to reduce emissions.

“It might be around thinking about new products and services that the company could develop which have energy efficiency logic to them.”

In particular, carbon risk training is being embraced by certain companies in the financial services industry, which have been focused on issues around carbon risk investment and pricing of loans to companies that might be more carbon exposed, Wright added.

“In the financial services sector there is a fair bit of emphasis in parts of their businesses for specific employees around carbon risk and how that might impact on the business metrics of the firm,” he said.

In financial services, in particular, these training initiatives have to be effective because they go to the core of the business operation and the products and services they offer, he said.

Wright explained to L&D Professional that there are a lot of ways of empowering employees around not just work issues but how they can reduce carbon emissions in their own lifestyles.

Some of these companies introduced powerful culture change initiatives around reducing emissions in the late 2000s when Kevin Rudd was Prime Minister, and there was a lot of focus climate change action, he said.

“It was a way of locking into employee passion around something they believed was important, and how they could link that to their working lives and their personal lives,” Wright added.

“That’s an aspect of not so much the training but the engagement of employees around green issues and emotionality.”

Traditionally, Europe has been a leader on climate change action in business, however, this waxes and wanes as regulatory and legislative structure change, said Wright.

In contrast, Australian businesses have not been as progressive as they could be, particularly given how as a country we are particularly exposed to climate risk, he said.

However, the major problem of how companies are responding globally to climate change is their inherently short-term thinking, Wright told L&D Professional.

“Businesses are really focused on profit and loss, year in year out. If you can’t link climate to a clear business driver, it doesn’t get much traction,” he said.

When climate change is typically framed in businesses around strategic business issues (such as products and services, risks and opportunities) then it can potentially gain momentum, he added.