Davos Wrap-Up: Circular Economy, Global Risk Report, Fracking, Economics of Climate Change
Climate change and clean energy took top billing at this year’s World Economic Forum in Davos, Switzerland, with world leaders and CEOs discussing how both affect the global economy and businesses’ bottom line. The four-day annual meeting wrapped up on Saturday. Here are some highlights:
The World Economic Forum and partners the Ellen MacArthur Foundation and McKinsey & Co. launched Project Mainstream, a collaborative project that the organizations say could help businesses to shift towards a circular economy and as a result save $500 million in materials and prevent 100 million metric tons of waste globally. Companies including Philips, Kingfisher, Veolia, DSM and Indorama have committed to be part of the effort.
Extreme weather events pose the second biggest threat to economies, according to the World Economic Forum’s Global Risk report. UN climate chief Christiana Figueres to German news agency Deutsche Welle that not dealing with climate change would mean a huge economic fallout. “If we don’t address it, it’s a major risk to the global economy, but if we do, it’s a real promoter of global economy because it can bring new jobs,” she told DW.
This gives greater urgency to reaching a binding climate deal in Paris in 2015 to reduce carbon emissions from coal and oil, Figueres told the Associated Press, adding that the global economy is at risk unless leaders agree to shift to cleaner energy sources.
Fracking could deliver a huge boost to the economy, encouraging businesses to come back to the UK and driving down energy prices, UK Prime Minister David Cameron said on Thursday, urging the EU not to impose “premature regulatory burdens” on shale exploration. Cameron said fracking has prompted re-shoring, the return of businesses, in the US, the BBC reports. Cameron argued the UK must do more encourage firms that have moved abroad to cut costs to return: “There is no doubt that when it comes to re-shoring in the US, one of the most important factors has been the development of shale gas, which is flooring US energy prices, with billions of dollars of energy cost-savings predicted over the next decade.”
Also in Davos, PwC released its 2014 CEO survey that found chief executives recognize the importance of measuring businesses’ whole footprint — environmental, social, fiscal and economic — but most companies still only measure and report on their financial performance.
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