Climate Change Strategy: The Business Logic Behind Voluntary Greenhouse Gas Reductions

California Management Review, Vol. 47, No. 3, pp. 21-46, 2005

Ross School of Business Paper No. 905

45 Pages Posted: 15 May 2006 Last revised: 29 Oct 2013

Andrew John Hoffman

University of Michigan, Stephen M. Ross School of Business

Date Written: November 1, 2004

Abstract

Economic uncertainties have prompted American policy-makers to withdraw U.S. involvement in the Kyoto Treaty. But interestingly, some U.S. companies are taking advantage of the present lack of a mandatory U.S. GHG emission reduction program to set targets at their own pace and in their own way; a way that fits with their own strategic objectives. To date, as many as sixty corporations, with net revenues of roughly $1.5 trillion, have set reduction targets. And hundreds more are considering such steps. In point of fact, many of these companies are agnostic about the science of climate change or the social responsibility of protecting the global climate. The reasons that they are making these emission reductions are decidedly strategic. They are searching for ways to be prepared for the long term should GHG emission reductions become mandatory, while at the same time attempting to reap near term economic and strategic benefits should that future not emerge or be delayed. Using examples of specific business actions, this paper will assess a series of ways in which this is being done.

Keywords: Greenhouse Gas, social responsibility, emission reduction

JEL Classification: O13

Suggested Citation

Hoffman, Andrew John, Climate Change Strategy: The Business Logic Behind Voluntary Greenhouse Gas Reductions (November 1, 2004). Ross School of Business Paper No. 905; Ross School of Business Paper No. 905. Available at SSRN: https://ssrn.com/abstract=902357

Andrew John Hoffman (Contact Author)

University of Michigan, Stephen M. Ross School of Business ( email )

701 Tappan Street, R4390
Ann Arbor, MI MI 48109
United States
734.763.9455 (Phone)

HOME PAGE: http://www.andrewhoffman.net/

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