ABSTRACT
The general line of argument pursued in this chapter is that it is diffi cult to devise and implement effective climate change policies and accompanying policy instruments without the active consent of business, yet securing that consent may risk diluting policy to such an extent that it is insuffi ciently effective. For example, business may favour market mimicking policy instruments such as emissions trading schemes which may have less impact than a carbon tax. The strong position of business in relation to climate change policies results in large part from its hard power capabilities exhibited in structural leadership, but also from cognitive leadership that seeks to shape the counters of the debate (entrepreneurial leadership is also exhibited, but is of less decisive importance in terms of policy outcomes). A secondary theme in the chapter is that business (which is not a homogenous category) has shifted its position over time from an initial denial of climate change by some interests to a more sophisticated strategy that attempts to infl uence the policy instruments deployed. It should be emphasised that this does not mean that business interests dominate the policy debate: indeed, at Copenhagen they felt somewhat excluded. As explained in Chapter 13 by Wurzel and Connelly, environmental non-governmental organisations (ENGOs) have a number of strategic and tactical advantages in relation to business that allow them to infl uence the debate and shape policy. What is meant by ‘business’? In simple terms, businesses are legally constituted entities that seek to make a profi t by selling goods and services. However, when we talk about ‘business’, what is the level of aggregation at which analysis should take place? It is suggested that it is necessary to examine both the representative organisations of business and also individual fi rms. Large fi rms operate politically both on their own behalf and through associations. As far as representative organisations of business are concerned, climate change is dealt with both as an important policy topic by existing business organisations and by new organisations that have a specifi c remit in relation to climate change such as the World Business Council for Sustainable Development (WBSCSD). Such organisations are of particular signifi cance when the dimension of leadership is considered. It is here in these organisations
that focus on climate change that one fi nds evidence of entrepreneurial leadership in terms of devising mutually acceptable formulas and brokering the interests of key players in building support for these formulas. This is then combined with elements of a transformational leadership style, at least in the sense of seeking to satisfy the higher needs of potential followers. More typically, however, the leadership being exercised by business is structural in character. This refl ects the fact that business enjoys hard power deriving from its economic strength (Coen, Grant and Wilson 2010). This exercise of structural power seeks to translate power resources into bargaining leverage in an effort to bring pressure to bear on others to support the stance being taken by business. Necessarily, this often produces a humdrum leadership style that is frequently reactive and incremental in character. There is, however, considerable variability in leadership styles within business in relation to climate change. At the fi rm level it is necessary to consider the orientation of the particular fi rm. This will be infl uenced by, in part, the goods and services that the fi rm produces, but also by its particular history and culture. In Grant (1984) a distinction was made between ‘tripartite’ and ‘capitalist aggressive’ fi rms. One may reformulate this to replace the category ‘tripartite’, which refl ected the policy priorities of the period, by ‘environmentally friendly’ and hence taking account of the debate on ecological modernisation. Thus, for example, within the airline industry, one fi rm may seek to claim that it is trying to do all that it can to moderate the climate change impact of fl ights by, for example, reducing fuel consumption or offering offsets. Another, Ryanair being a prime example, may simply deny the existence of the problem or its responsibility for it and take an aggressive stance on the issue in defence of its profi ts. Thus, ‘a cleavage begins to open up not between business and environmentalists, but between progressive, environmentally aware business and short-term profi t takers on the other’ (Weale 1992: 31). Weale also suggest that the main dividing line no longer runs between business and environmental non-governmental organisations (NGOs) but between progressive/environmentally concerned businesses which often form (informal) alliances with reformist environmental NGOs and short-term profi t takers. This chapter presents evidence of such collaborations. Ecological modernisation theory would suggest that a positive response by fi rms to environmental challenges may be in their own interests. However, this may apply more clearly to pollution with a specifi c geographical impact than a global public bad like climate change. In the case of pollution, a fi rm may derive a number of benefi ts from taking action. It may avoid fi nancial penalties for failing to act, but by making use of by-or waste products or increasing energy effi ciency, its own capacity to make profi ts may increase. The relationship in the case of climate change between changes in practice and profi ts may be less clear. Actions taken by any one fi rm are not likely to have a major impact on the incidence of climate change, nor will that fi rm necessarily derive any specifi c benefi ts.
