The Conference Board of Canada

The Conference Board of Canada

March 18, 2009 10:52 ET

The Conference Board of Canada/Climate Change: Resource and Energy Sectors Identify Mostly Risks; Financial Sector Sees More Opportunities

OTTAWA, ONTARIO--(Marketwire - March 18, 2009) - Climate change poses more risks than opportunities to companies in the oil and gas, mining, forestry and utility sectors, but the financial services sector perceives more opportunities than risks from an increasing focus on climate issues. A new Conference Board of Canada publication, Carbon Disclosure Project: How Four Business Sectors See Climate Change Risks and Opportunities, details the divergent perspectives by sector among Canadian firms responding to the Carbon Disclosure Project 2008-Canada 200 survey.

"The overall Carbon Disclosure Project results indicate that Canada's largest companies see a balance of risks and opportunities from climate change. But the picture changes dramatically when the responses are broken down by sector. Not surprisingly, how companies come to grips with climate change depends largely on whether they operate in high or low carbon-impact sectors," said Graham Campbell, Associate Director, Energy, Environment and Technology of the Conference Board, which is the Canadian partner for administering and reporting on the Carbon Disclosure Project (CDP).

This publication examines the sector-specific risks and opportunities in three high-carbon-impact sectors -oil and gas; raw materials, mining and forest products; and gas and electric utilities-and one low-carbon-impact sector, financial services.

The key risks identified by respondents from companies in the three high-carbon-impact sectors included:

- physical risks to their operations, supply chains and facilities;

- increased costs resulting either from higher energy prices or energy taxes, or both; and,

- emerging regulatory risks because of uncertainty over changing federal and provincial greenhouse gas regulations.

Companies in these sectors perceived a limited number of opportunities. Under emerging emissions trading regimes in North America, firms will have a financial incentive to reduce greenhouse gas emissions and generate credits. Companies also indicated that they could cut costs by improving energy efficiency. To seize these opportunities, firms in these sectors must make major changes to their technologies and undertake significant capital investments, which will be difficult in the current economic downturn.

Financial services companies identified opportunities to become involved in new carbon trading markets, as well as in financing green energy and infrastructure investments. Risks to financial services firms are related primarily to corporate reputation. These companies are also concerned about indirect risk from the additional costs and threats that climate change poses to their clients.

The CDP is an annual voluntary survey of the world's largest corporations on behalf of an international coalition of large institutional investors. In Canada, the survey was sent in February 2009 to the 200 largest companies (by market capitalization) traded on the Toronto Stock Exchange.

The British High Commission in Canada supported the publication of this Executive Action briefing. Previous titles included Carbon Disclosure Project - Canada 200 Summary for Investors and Carbon Disclosure Project - Why Should Companies Participate?.

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