International Progress and Chinese Practice on Climate and Environmental Change Risk Disclosure, the Beijing Meteorological Society’s Third Expert Forum

The recent Code Red warning regarding the Intergovernmental Panel on Climate Change (IPCC) AR6 report reminds us that humanity has little time to avoid a catastrophic hothouse Earth environment. However, the vast gaps in policies and investment for mitigation, adaptation, and sustainable development are the reality we must face honestly with more systematic and economic thinking. Enterprises worldwide are critical players in the puzzle. They can be responsible leaders setting and then implementing emission reduction plans with vigour to reduce our collective vulnerability while enhancing their physical, social and economic resilience. Moreover, more and more enterprises are positively yet passively engaged in climate actions through climate-related financial disclosure and environmental, social and governance reporting (C-ESG hereafter).

The complexity of C-ESG practices requires, given its nature, an inclusive yet adaptive system with institutional, social, economic, earth and technological (ISEET) elements embedded across relationships, structures, functions, and dynamics. The ISEET framework developed by CLIMsystems is a tested method for thinking and analysing the dynamics of C-ESG that includes critical aspects of future climate change. Of the ISEET system elements, the institutional and technological systems could change most rapidly and thus drive future tipping points. With this understanding, the testing of potential mitigating economic policies incorporating climate change can be accomplished.

On 13 August 2021, the Beijing Meteorological Society (BMS) held an expert forum (its third event of this type) with an online format. The forum was hosted by the BMS and supported by Beijing Normal University (BNU), the New Zealand International Global Change Institute (IGCI)/CLIMsystems, and the Beijing Institute of Urban Meteorology. Professor Ye Qian (BNU), Executive Director of the Society, and Senior Climate Scientist Dr Li Yinpeng of IGCI/CLIMsystems presented. Researcher Miao Shiguang, Secretary-General of the Society, chaired the meeting. More than 70 researchers and postgraduates from the Urban Institute, Directors and members of the BMS, relevant research and business personnel attended the forum, including business units such as Yushu Tibetan Autonomous Prefecture Meteorological Station, Nangqian County Meteorological Bureau and Zhengduo County Meteorological Bureau in Qinghai Province.

The forum introduced the concept of the Anthropocene, a new geological period in which the earth and our society are living today, its basic features, and its risk characteristics. With climate change and its evolving risks, enterprises may be impacted and therefore should be lead actors in addressing its mitigation. The main advancement of the C-ESG mechanisms in developed countries is the co-benefits that the disclosure of climatic risks can bring to enterprises and investors. Associated business and employment opportunities may ensue. From the perspective of international development and China's development, the discussion in the forum focused on C-ESG, global trends in addressing climate change, the identification of new growth points and the discovery of new areas for development.

The global climate is undergoing profound change, as exemplified by the Red Code Alert issued by the IPCC. There is a clear risk to the survival and sustainable development of human societies. However, continued changes in climate offer societies a chance to plan for and alter their development concepts, production methods, and consumption patterns. Scientific, political and business communities are intensifying their cooperation to discover new economic development models to replace those driven by high fossil fuel emissions, natural resource consumption and costly externalities leading to the physical degradation of the global environment.

With recent reforms, China has also followed a GDP-driven development approach adopted by developed countries. However, although the economy has achieved rapid growth over the past four decades, it has also caused in some cases severe damage to the environment and natural resources. Moreover, with the changing socio-economic and political conditions in-country and abroad, China's development approach has encountered challenges. Managing climate change will require fundamentally changing development pathways, with a new focus on low-carbon, resource-saving, and environment-friendly development. The Chinese government and enterprises must take these actions and quickly yet effectively mainstream the C-ESG systems approach in the decision-making process, especially in investment and strategic planning.

C-ESG reporting and monitoring form one pillar of the green finance system. Therefore, data, methodologies and services for C-ESG practice in China need to be addressed and improved. Supported by a German Government funded GIZ project, led by CLIMsystems and BNU, and an international team including BSI and SLR are ramping up the capacity building, research and development.

Participants had in-depth exchanges on the C-ESG system analysis methods and their application in urban areas during the forum. The discussion also focused on the potential willingness of domestic enterprises to participate and the technical thresholds they may face for inclusion. The importance of integration of scientific accuracy and economic directionality were highlighted. Thus, the forum broadened everyone’s horizons and fostered innovative thinking while providing new perspectives to analyse, understand and respond to climate change.

For more information, see: http://documents.climsystems.com.s3.amazonaws.com/climate-insights/giz/C-ESG%20disclosure%20trend%20and%20China%20practice.pdf

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