Business leaders: Addressing climate change makes cents

As business leaders and members of a Congressional bicameral task force on climate change met this morning to discuss the issue -- the gist was that it helps them make money -- the IKEA Group, in particular, had a big announcement.

The U.S. division, based in Conshohocken, is making its first wind farm investment in the U.S., which will also be the largest single IKEA Group renewable energy investment so far, anywhere in the world.

The 49-turbine project, called Hoopeston Wind in Hoopeston, Ill., is a 98 MW farm, which is expected to generate the energy equivalent of powering 34,000 average American households.

IKEA has committed to becoming energy independent by 2020.

In making this morning’s announcement, CFO and acting U.S. president Rob Olson told the Congressional committee that responding to climate change “will unlock business innovation and investment.”

“We are committed to renewable energy and to running our business in a way that minimized our carbon emissions, not only because of the environmental impact, but also because it makes good financial sense,” Olson said.

IKEA’s news, and statements from other business leaders about how they are reducing emissions and taking other steps to mitigate climate change — and how that is good for their bottom line — prompted a challenge from Sen. Sheldon Whitehouse, D-Rhode Island.

“What can we do to bring the place where America’s corporate sector is to the attention of Washington … where, frankly, a very different point of view is being represented?” he asked.

He said legislators are “tantalizingly close” to being able to institute a system-wide carbon fee. “The problem I have is that the face of the corporate community in our world, in Washington, is totally at odds” with the message that mitigating for climate change is good for business.

“For reasons that escape my comprehension, the U.S. Chamber of Commerce … is in climate denial mode. They want to hear nothing about it. … The lobbying power that is brought to bear … is very heavily into denial.”

Letita Webster, a sustainability director for North Carolina-based VF Corporation, which makes outdoor products and apparel, had an easy answer: “I think, frankly, we’ve been heads down, getting it done.”

They’ve been reducing their carbon footprint. They’ve been taking care of their supply chain, seeing first-hand the fluctuations in the price of cotton that come with “very unpredictable weather patterns.”

“What were looking for is predictability” from the government, she said.

Kevin Rabinovich, sustainability director at Mars, Inc., a food, drinks and pet care company based in Virginia, said his company is coming at climate change from both ends — reducing its own impact, but also planning for the effects.

The company has set a coal of a 100 percent reduction in emissions in 2040, he said.

To help stabilize their supply chain of food stuffs in the future, the company has sequenced the genome of cocoa and put it into the public domain. Rabinovich called it “an incredibly powerful tool” to help researchers develop versions that are higher-yielding, or more resistant to extreme weather.

Sprint, the communications company, has started “hardening” its sites so they can withstand weather varability. They’ve lessened their own emissions, and required that their suppliers do likewise, said Amy Hargroves, the company’s sustainability director.

Customers are getting it. Customers are pushing, the business leaders said.

Colin Dyer of the Illinois-based commercial real estate company, Jones Land LaSalle, said spaces that are built with sustainability in mind command higher prices and are vacant less often than others. They also retain their value, he said.

“So often here in Congress, we get the word that it’s too expensive, too difficult,” said U.S. Rep. Henry Waxman, a California Democrat. What he was hearing from the business leaders, however, was that they started with climate change initiatives because it was good for their reputation.

Then they began saving money. then the value of their businesses increased.

“I’m very impressed by what you had to tell us,” he said.

Back to IKEA: The company plans to own 206 wind turbines worldwide, including in Canada, Denmark, France, Poland, Germany and the United Kingdom.

IKEA also has installed 550,000 solar panels on stores in eleven countries. It also is changing products in its stores. It removed plastic shopping bags in 2006 and incandescent bulbs in 2012.