Taking Stock of Strategies on Climate Change and the Way Forward: A Strategic Climate Change Framework for Australia

Abstract

Human made ecological changes are evident, and believe to be immensely impacted on climate change (CC), and natural disasters are occurring more regularly with a full scale ever before. Addressing the issue of GHG emissions associated with CC is becoming one of the critical and mounting social, economic, political and ecological issues for governments, industries and businesses (Griffiths et al. 2007; Hoffman 2005; Kolk & Pinkse 2005; Khandekar et al. 2005; Waller-Hunter 2004). Countries that have agreed to follow the Kyoto Protocol have implemented a variety of strategies, policies and regulations which have led industries and businesses to align and redesign their strategies (Griffiths et al. 2007). Countries like Denmark and Germany where implemented institutional and regulatory framework to respond on CC, and GHG reductions have exploited CC challenges as an opportunity for industries and businesses to promote creativity and innovation (Hoffman 2005; Kolk & Pinkse 2005). The US and Australia for instance, have adopted a more voluntary approach to CC, and GHG reductions (Griffiths et al. 2007). Research studies are needed to assess Australia’s commitment on CC, and the way forward. All most all studies carried out so far particularly in Australia are more of awareness based studies on CC. Therefore this study aims: 1) to uncover current public policies, industry innovations and corporate level strategies in Australia to address requirements of the Kyoto protocol (United Nations 1997) and national government strategic initiatives for Green House Gas (GHG) emissions; 2) to explore sustainable and futuristic CC, (i.e. GHG) strategies that have been developed and implemented by national and states governments, and major businesses of carbon emission in Australia to create market value for carbon voluntarily or otherwise. As an outcome of this research project, a strategic climate change (SCC), framework to assess and foresee climate change and impact on industry and businesses will be developed; 3) to investigate CC and GHG emission reductions initiatives, strategies, policies and programs at national state, industry and business level in Australia by revisiting such initiatives on CC and GHG emissions and to examines competitiveness and innovations based strategic initiatives that are foreseen by major companies. The study focuses particularly on resource and energy industries as a case study with in-depth analysis and will synthesise to develop a SCC framework based on initiatives taken and industry foresight on GHG emissions of these industries. Therefore, this research study will attempt to address this need and shed some light on strategies on CC, in particular GHG emissions and public/corporate strategies for sustainable GHG reductions. Business strategy literature is heavily based on competitive advantage of a firm and industry structure which is influenced by industrial economics (Barney 1991; Porter 1990, 1985, 1980; Chandler 1966). Competitive focus has currently moved on to firm resources, capabilities, knowledge management and strategies (Barney 1999; Oliver 1997; Nonaka 1995) with industry characteristics and structures (Makadok & Barney 2001; McGahan & Porter 1997). Others argue that country conditions and characteristics are significant for firm performance (Griffiths et al. 2007; Thomas and Waring 1999; Christmann et al. 1999) and on the other hand state and social institutions can influence on the way business operates and its economic performance (Rao & Singh 2001; Aupperle et al. 1985). The study draws theories from business strategy, corporate social responsiveness, power and politics in organisation, power and interest of key stakeholders (Wit & Meyer 2010; Johnson et al. 2008; Griffiths et al. 2007) that influence on GHG reductions strategies. Theories are used to interpret and synthesise the theoretical reflection on empirical findings.The exploratory nature of this study, people, social and culture-based research embraced the fundamental philosophy of subjectivism. Therefore, the nature of this research is exploratory, strategic and applied (see Wickramasinghe & Cameron 2004). A qualitative research methodology was selected to explore people’s experiences, behaviour and institutional approaches. The study begins with analysing, assessing and interpreting strategic initiatives on CC in Australia to-date, and the analysis is based on governments’ initiatives and programs on CC and industry and business CC strategy, governance, corporate social responsiveness, and power and politics in such initiativeness and implementation. Published reports and literature are employed to gain a sufficient understanding about a big picture of CC initiatives in Australia. The research is based on reports, research literature, archives, stories, national and state level programs to investigate past CC actions. Industry, company annual reports, other relevant publications of the industry and companies, and media reports are used to evaluate industry and companies’ strategic initiatives, perceptions on CH, management commitment, power and politics in strategy and CC initiatives of them. The amount of data generated by qualitative methods is extremely large and the data analysis software tool, ‘Nvivo, Qualitative Data Software’ is used to manage data efficiently throughout the course of the research project (Silverman 2001; Patton 2010). The study employs content analysis and thick descriptions to assess and interpret data. The research output is described using words and illustration rather than numbers (Penrose 1990; Miles & Huberman 1994). Credibility and reliability of data are achieved through data triangulation (Denzin 1989; Yin 1994; Silverman 2009). By providing a broader understanding of SCC at national, state level and industry in general, the study focuses on most influential and powerful industry: resource industry to explore the industry perspective, initiatives, management commitment and programs on CC. Based on ground information from companies, this study develops strategic industry foresight on CC for the resource industry. This leads to develop a SCC framework for resource and energy industries in Australia to address climate change issues as an exploitation opportunity to enhance environmentally responsive innovation and sustainable climate change approach. The strategic foresight provides opportunities to see possible futures and act on them before such future arrives. This approach to develop SCC framework views industry and firms more holistically than functionally. It provides ability for the sector on strategic intelligence scanning, explore emerging issues, trends, systems thinking, scenarios and visioning that lead to strategy development and strategic planning for the sector (Warren & Fuller 2006; Fink et al. 2005; Costanzo 2004; Voros 2003). It is evident that how power play within the resource industry – such as the coal sector – influences strategic direction and policy decisions of the industry and firms. Country strategic initiative on CC is fairly reactive and slow in response in converting challenges as an opportunity as the lack of a national GHG emissions target strategy and carbon trading mechanism in place (Griffiths et al. 2007). Therefore, this study explored and examined: 1) how firms and industry in resource sector strategic initiatives and foresight develop the capability to capitalise on the changing conditions of the CC challenge and structure the adaptation process, 2) how different firms’ strategies and governance systems enhance the sustainable innovation and knowledge management within the industry. The study further explored why some companies are adopting proactive strategies despite CC and what is the value of such clean-green strategies? What might be the impacts of climate change and Kyoto Protocol issues on organisations, and if any such impacts how can these impacts be foreseen successfully? What types of strategies, policies and actions have to be taken to address this timely, multifaceted and critical issue? The outcomes of this project are to take stock of historical initiatives on CC and foresee the way forward. Exploration of national and state level strategic initiatives will advance the existing body of knowledge on CC strategies and programs in Australia, and aligning and integrating knowledge and research on CC, business strategy, corporate social responsiveness, power and politics in climate change processes in Australia. The study also developed strategic foresight for resource industry based on resource industry scenarios. This leads to develop a strategic climate change framework for major carbon generators of the country to adopt sustainable and innovative strategies to respond to CC issues. As we found, CC and strategic approach to reduce GHG emissions are not clear at national, state, local government and industry level. There is increasing evidence to show that there is very little impact on such initiatives. Developing industry foresight and scenarios will provide innovative approach to see outward and forward looking strategic approach to the resource industry to be proactive and convert CC issue as an opportunity for industry innovation. Developing a strategic CC framework is absolutely novel and innovative as a framework to address emerging CC challenges.