Global warming report 11

Global warming....

1. “BRIDGE” BUSINESS PLANNING UNIT 1

EXECUTIVE SUMMARY

The purpose of this report is to analyze the reasons that could affect the company’s
image and to recommend actions that the company can take on how to safeguard or improve
the company’s image, as well as approaches and strategies that will ensure that the company
is seen as a socially and environmentally responsible member of the global business
community.

Climate Change represents a change in long-term weather patterns, and Global warming
refers to an average increase in the earth’s temperature, which in turn causes changes in
climate.

The Blue Skies Group is losing its market share because it has been a major culprit in
contributing towards Global Warming. The recent press reports have clearly identified it and
consumers who are eco-friendly have reduced purchasing the products and services of Blue
Skies Group.

The company mainly contributes towards Global Warming by Emitting green house gases,
burning of fossil fuel and wasting electricity, water and paper while the Climate change
affects the businesses due to natural disasters, financial impacts and demand for eco-friendly
products. As a world class organization the Blue Skies group must ensure to overcome these
problems and increase its profits.

Verve Energy, which is the major competitor of Blue Skies Group, is securing its place in the
market as an eco-friendly organization. This has lead them to be the market leaders in
energy producing. They have come up with new strategies, which are described in this report
to reduce the green house effect and be “clean & green”. This has created a successful public
image for Verve Energy. The Blue Skies group can also take examples from eco-friendly
companies such as Toyota, and Sanyo to develop strategies and improve the public image
and most importantly capture the market.

"The longer we wait to do something about it, the more change we will have."

Global warming can be slowed, and stopped by organizations, with practical actions such as,
 Reduce, Reuse, Recycle
 Use the "Off" Switch
 Replace incandescent light bulbs with compact fluorescent bulbs.
 Drive Less and Drive Smart
 Produce energy-efficient electronics and appliances.
 Plant a tree and make an eco-friendly work environment.
 Support clean, renewable energy.
 Mount a local campaign against global warming

These actions which have been described in the business point of view will improve the
company’s public image, which can generate direct benefits, in terms of greater acceptance
of their products and services, which is manifested in more sales, and the indirect benefits
that a good public image of the company brings, such as the attraction of customers,
suppliers, and employees who are committed to their efforts.

2. “BRIDGE” BUSINESS PLANNING UNIT 2



TABLE OF CONTENTS
EXECUTIVE SUMMARY ......................................................................................1
1. INTRODUCTION ...........................................................................................3
2. DISCUSSION................................................................................................4
2.1 CLIMATE CHANGE ....................................................................................... 4
2.1.1 GLOBAL WARMING ................................................................................ 4
2.2 THE COMPANY PROFILE ............................................................................... 5
2.3 TO EVERY ACTION THERE IS AN EQUAL AND OPPOSITE REACTION....................... 5
2.3.1 THE COMPANY AFFECTS CLIMATE CHANGE................................................. 5
2.3.2 CLIMATE CHANGE AFFECTS THE COMPANY................................................. 6
2.4 BENCHMARKING ......................................................................................... 8
2.4.1 VERVE ENERGY ..................................................................................... 8
2.4.2 ECO-FRIENDLY ORGANIZATIONS .............................................................. 9
3. CONCLUSIONS ...........................................................................................10
4. RECOMMENDAT IONS..................................................................................11
5. REFERENCES..............................................................................................13

3. “BRIDGE” BUSINESS PLANNING UNIT 3


1. INTRODUCTION

This report was commissioned by Mr. Forrester, Chairman and CEO – Blue Skies Group.
Its purpose is to identify the reasons that could affect the company’s image and to
recommend actions that the company can take on how to safeguard or improve the
company’s image, as well as approaches and strategies that will ensure that the company is
seen as a socially and environmentally responsible member of the global business
community.

According to the information gathered from the Internet, articles and journals, Climate
Change or Global Warming is mainly caused by the emission of the green house gases such
as carbon dioxide, methane, nitrous oxide and CFC etc. and it has identified that the Blue
Skies Group is one of major organizations in Australia, which has the largest carbon emitting
plants. Due to this matter of fact, the company’s image has been corrupted and the profits
are decreasing day by day.

Climate Change is a serious global threat, and it demands an urgent global response. This
Report has assessed a wide range of evidence on the impacts of Climate Change towards the
Blue Skies organization. From all these evidence gathered leads the public to a simple
conclusion: The Company is losing its gradually losing its market share.

The company mainly contributes towards Global Warming by Emitting green house gases,
burning of fossil fuel and wasting electricity, water and paper. Therefore, an organization has
much to do to manage the risks involved in Climatic Change and response for both the
reduction of emissions and adaptation to the impacts.

Verve Energy, which is the major competitor of Blue Skies, has developed their strategies
to be a clean green organization and it has led them to success. This report includes the
major strategies they have used and how they have captured the market share.

Finally, the report includes recommendations on how Australian businesses can become
“Clean and Green”. The Company cannot stop their production. Therefore, the company can
publish the efforts they are making to conserve energy, reduce emissions, and create
solutions to the climate change problem and they can improve their public image and
increase their profits.

4. “BRIDGE” BUSINESS PLANNING UNIT 4

2. DISCUSSION

2.1 CLIMATE CHANGE
Climate Change represents a change in long-term weather patterns. They can become
warmer or colder, annual amounts of rainfall or snowfall can increase or decrease.

“Climate change is the most severe problem that we are facing today.” (Sir David King -Former
Chief Scientist for the UK Government)


2.1.1 GLOBAL WARMING

Global warming refers to an average increase in the earth’s temperature, which in turn
causes changes in climate. A warmer earth may lead to changes in rainfall patterns, a rise in
sea level, and a wide range of impacts on plants, wildlife and most importantly humans.
(NOAA & U.S. Environmental protection agency)

Global temperatures are expected to continue to rise as human activities continue to add
carbon dioxide, methane, nitrous oxide, and other greenhouse gases.

According to NOAA and NASA data, the Earth's average surface temperature has increased
by about 1.2 to 1.4ºF in the last 100 years. The eight warmest years on record (since 1850)
have all occurred since 1998, with the warmest year being 2005. Most of the warming in
recent decades is very likely the result of human activities. (U.S. Environmental protection
agency,)



Figure 1 - 1000 years of CO2 and Global Temperature Change
Source: ACIA 2004

5. “BRIDGE” BUSINESS PLANNING UNIT 5

2.2 THE COMPANY PROFILE

The Blue Skies Group is a well established holding company in Western Australia with
controlling interests in a variety of companies (both domestic and international), among
others in the manufacturing and retail industries.

There are over 10,000 employees in Blue Skies Group working in,
 Five main Nuclear and Industrial Power plants &
 Over ten factories in Australia and Sri Lanka

Productions
 Energy - The power stations have a capacity to produce 3000MW of electricity.
 Electronic & Electrical appliances.

Other Industries of Blue skies Group
 Tourism
 Coal Industry
 Wine Industry


2.3 TO EVERY ACTION THERE IS AN EQUAL AND OPPOSITE REACTION

As you, all know this is the third law of motion of Isaac Newton. This can be applied in
Business in many ways. The following is when Business deals with Climate Change

Company affects Climate Change Climate Change affects the company.

2.3.1 THE COMPANY AFFECTS CLIMATE CHANGE
Emission of greenhouse gases (GHGS)

When discussing the greenhouse effect it is important to keep in mind that things like
methane emissions and carbon dioxide emissions have been around for longer than humans
have. Methane and carbon dioxide are both naturally occurring gases that meet some specific
needs in the natural order of the planet. The problem is that, since the industrial revolution,
we have been producing them in larger quantities than the planet can handle. Naturally,
these gases then hang around in our atmosphere waiting to be processed and in the
meantime, they absorb heat. That is why greenhouse gases are dangerous and that is how
they are contributing to the problem of global warming (Nuttall, D. 2007)

Humans have increased carbon dioxide (CO2) in the atmosphere by more than 37% since the
Industrial Revolution. (NOAA 2008)

The manufacturing processes of the Blue Skies giant factories that are located all over the
world are one of the largest producers of these green house emissions.

6. “BRIDGE” BUSINESS PLANNING UNIT 6

The Burning of fossil fuel

FOR INDUSTRY
Even though United States & Europe’s are main culprits for this, Australia and Sri Lanka are
also moving towards this trend. Fossil fuel has increased dramatically over the years as
indicated by the huge foreign exchange spent. The Blue Skies Group is one of the major
organizations responsible for this because it has expanded their production and it burns more
fossil fuel every day making the earth warmer every minute. (Australian press reports)

FOR TRANSPOTATION
A huge amount of fuel burning occurs because there are many employees of Blue Skies using
their private vehicles to attend work because of the fuel allowance provided by the
organization. (Australian press reports)
Waste of electricity, water and paper

There is huge wastage of electricity, water and paper in Blue Skies. Lights, fans, Computers
and printers are switched on 24/7 with or without employees. The average electricity and
water cost of Blue Skies Group is about 20 million Australian Dollars per month. Blue Skies
Group uses over 2 tons of paper annually and since there is no proper management the
company cannot identify whether it is necessary to spend that amount. (Blue Skies – annual
report 2007)


2.3.2 CLIMATE CHANGE AFFECTS THE COMPANY

Climate change is affecting businesses and economies at home and around the world. If
actions are not taken to curb global carbon emissions, climate change could cost between 5
and 20 percent of the annual global gross domestic product (The Nature conservancy)

The impacts of climate change are long-term and persistent and uncertainties and risks in the
economic impacts are pervasive.

Natural Disasters

Globally, more intense hurricanes and downpours could cause billions of dollars in damage to
property and infrastructure. Especially the properties located in the coastal areas are in
danger due to rising of sea levels and Tsunami. Declining crop yields due to prolonged
drought and high temperatures could put hundreds of thousands of people at risk for
starvation. (The Nature conservancy)

High sea temperatures also threaten the survival of coral reefs, which generate an estimated
$375 billion per year in goods and services and it will harm the tourism industry. (The Nature
conservancy). Businesses in the tourism industry in areas affected by storms could see a
reduction in demand, and drier and warmer conditions in the mountains could severely harm
businesses related to skiing and snow sports.

7. “BRIDGE” BUSINESS PLANNING UNIT 7

Financial

Although Blue Skies expand the production, it did not achieve the estimated profit. According
to the 2007 Annual Report of Blue Skies the profits of the company has decreased gradually
over the last four years.



Figure 2 - PRODUCTION COST & NET PROFIT
Source: Blue Skies Group – Annual Report 2007


The main cause is the recent press reports appeared in the West Australia about Australia’s
poor standing in terms of Carbon emissions. People who are concerned about the
environment has reduced purchasing products from organizations such as Blue Skies because
of the massive amount Carbon released everyday and eco-friendly competitors have arrived
to the market. (Blue Skies Group – Annual Report 2007)


Demand for Products

Some industries and companies will see a change in the demand for their products. For
example, there could be greater demand for pharmaceutical products to combat diseases
that were previously restricted to tropical zones, but that with changes in climate have
advanced into other areas. There will be greater demand for appliances that are energy
efficient, and for vehicles, machinery, and equipment that use alternative sources of energy.
(The associated content) Therefore, the current products of Blue Skies will not fulfill these
requirements of the buyers.







0
2
4
6
8
10
12
14
2003 2004 2005 2006 2007
Billions (AUD)
Year
PRODUCTION COST
NET PROFIT

8. “BRIDGE” BUSINESS PLANNING UNIT 8


2.4 BENCHMARKING

2.4.1 VERVE ENERGY
Home page: http://www.verveenergy.com.au

 Verve Energy is Western Australia’s is leading energy producer.
 Verve Energy owns and operates power stations in the South West Interconnected
System (SWIS), which extends from Kalbarri in the north, east to Kalgoorlie, and
south to Albany.
 The power stations in the SWIS have a capacity to produce 3240MW of electricity.
 Verve Energy's generating portfolio also includes "green" energy. We have wind farms
at Albany, Esperance, Bremer Bay, Hopetoun, Denham, Exmouth and another is being
built at Coral Bay. We operate solar power plants at Kalbarri and Rockingham, and a
pilot biomass plant at Narrogin. (Verve Energy home page)

Verve Energy, which is the major competitor of Blue Skies Group, is securing its place in the
market as an eco-friendly organization. This has led them to be the market leaders in energy
producing.

Sustainable Energy

Verve Energy is at the forefront in developing sustainable energy production, using wind, bio-
energy and solar energy. Verve Energy recognizes the concern about possible global climate
changes from increased emission of greenhouses gases and is continuing to further develop
sustainable energy technologies.
Its sustainable energy systems reduce the amount of greenhouse gas emissions by many
thousands of tones a year and displace many thousands of tones of coal and gas from
electricity generation. (Verve Energy home page)


Environment

Verve Energy takes its environmental responsibilities seriously. It recognizes the value of the
environment to the community and future generations.
To deal with its many and varied environmental impacts, Verve Energy has established an
Environmental Management System (EMS) built on the principles of ISO 14001, the
international EMS standard. The Verve Energy Environmental Policy is the cornerstone of its
EMS and encourages Verve Energy to strive for environmental excellence as the cornerstone
of sustainability.
Verve Energy is committed to reducing the impact of atmospheric emissions on the
environment by the responsible use of resources.

They are working to improve their greenhouse performance with the Advancement of the
Narrogin Integrated Wood Processing demonstration plant towards commissioning.
Advancement of a process to secure a further 100GWh of renewable electricity production
from independent generators in Western Australia and Continuing commitment to the
Commonwealth Government’s Greenhouse Challenge Plus program. (Verve Energy home page)

9. “BRIDGE” BUSINESS PLANNING UNIT 9


Reducing the Greenhouse Effect

Verve Energy takes its environmental responsibilities seriously. It recognizes the value of the
environment to the community and future generations.
Verve Energy is committed in reducing the impact of atmospheric emissions on the
environment by the responsible use of resources.

Verve Energy is working in three major directions to reduce greenhouse gas emissions by
using greenhouse friendly fuels installing more efficient generation technology improving the
efficiency of existing generating plant and developing renewable energy sources.
Whenever new generating plant, such as the Cockburn Power Station, is built to replace old
inefficient plant, Verve Energy takes another step towards reducing atmospheric emissions.
Cockburn Power Station, which generates electricity from gas and steam, is better than 50%
more efficient than existing gas-fired and thermal power stations. It also significantly reduces
greenhouse gas emissions by up to one million tones per year.

In addition, it is committed to continue the development of renewable energy generation
using wind and bio-energy technologies, while maintaining an interest in solar technologies.
New renewable energy projects underway include the advanced wind-diesel systems at
Hopetoun, Bremer Bay and Coral Bay. Each of these systems reduces greenhouse gas
emissions. (Verve Energy home page)


2.4.2 ECO-FRIENDLY ORGANIZATIONS

Many organizations in the world (specially the Asians) have come up with various eco-friendly
products, which are already dominating the market.


TOYOTA

In 1997, Toyota revolutionized the automobile industry by introducing the Toyota Prius sedan
– the world’s first mass produced gasoline –electric hybrid car. Today, there are over 1.5
million Toyota hybrid vehicles on the road worldwide helping to reduce global CO2 emissions
and in Japan, large-scale solar arrays have already been used to reduce fossil-fuel
consumption.
In addition, Toyota has worked since April 2001 with the Chinese Academy of Sciences, the
Hebei Province Forestry Bureau, and the Green Earth Center to fight desertification in China’s
Hebei Province. (Newsweek, 2008).

SANYO

Sanyo is committed in providing future generations with abundant and efficient solar energy.
Their research and development in photovoltaic technology has achieved conversion
efficiency of 22.3% per cell. (Newsweek, 2008).

10. “BRIDGE” BUSINESS PLANNING UNIT 10


3. CONCLUSIONS

The public image of Blue Skies group is corrupted because of its high carbon emitting power
plants are major contributing factors for Global Warming and the usages of electricity, water
and paper have not been managed accordingly.

The Blue Skies Group does not gain the targeted profit although the production cost is
increasing day by day. This is due to the corrupted image, which has been created by the
recent press reports.

The organization is facing the impacts of Global Warming such as Natural Disasters, Financial
Problems (gradually decreasing of profit) and the high demand for eco-friendly products.

The major competitor “Verve Energy” has implemented successful strategies such as
reducing greenhouse gasses, to improve their public image and it has helped them to achieve
their targets in the field.

The Management of “Blue Skies Group” has to adapt to new strategies to be clean and
green, capture the market, and create a good public image.

The following recommendations will give the management an idea on designing their future
business strategies not only to be clean and green, but also to gain the expected outcome of
the investments.

11. “BRIDGE” BUSINESS PLANNING UNIT 11

4. RECOMMENDATIONS

Global warming can be slowed, and stopped, with practical actions that yield a cleaner,
healthier atmosphere. The question is will we act soon enough. It is a matter of time.

"Many people don't realize that we are committed right now to a significant amount of global
warming and sea level rise," said Gerald Meehl of the National Center for Atmospheric
Research. "The longer we wait to do something about it, the more change we will have."

Ultimately, it is up to each of us, as individuals and families, to take action to slow down and
eventually reverse global warming through everyday awareness of our energy use and
attention to ways we can conserve electricity and minimize fossil fuel usage.

Reduce, Reuse, Recycle

Do your part to reduce waste by choosing reusable products instead of disposables. Buying
products with minimal packaging (including the economy size when that makes sense for
you) will help to reduce waste. As we, all have e-mail facility, avoid as much as possible to
use hard copies to fill forms and other likes leave applications etc. Moreover, whenever you
can, recycle paper, plastic, newspaper, glass and aluminum cans. If there is not a recycling
program at your workplace, ask about starting one. By recycling half of your household
waste, you can save 2,400 pounds of carbon dioxide annually. (about.com)

Replace incandescent light bulbs with compact fluorescent bulbs.

Wherever practical, replace regular light bulbs with compact fluorescent light (CFL)
bulbs. Replacing just one 60-watt incandescent light bulb with a CFL will save you $30
over the life of the bulb. CFLs also last 10 times longer than incandescent bulbs, use
two-thirds less energy, and give off 70 percent less heat. (sierraclub)

Use the "Off" Switch

Save electricity and reduce global warming by turning off lights, computers, printers, fans, air
conditioners etc. when you leave a room.
Encourage staff to have their meals within a stipulated time. In that case, use time switches
to switch on and off lights/ water coolers and air conditioners within that period only.
(about.com)

Drive Less and Drive Smart

Less driving means fewer emissions. Besides saving gasoline, walking and biking are great
forms of exercise. Explore your community’s mass transit system, and check options for
carpooling to work or the organization can provide transport for the employees and cut down
the fuel allowances.
Minimize meetings in different locations. Use call conferencing and sharing documents by
using emails, which will reduce fuel and man power cost.
When you do drive, make sure your car is running efficiently. For example, keeping your tires
properly inflated can improve your gas mileage by more than 3 percent. Every gallon of gas
you save not only helps your budget; it also keeps 20 pounds of carbon dioxide out of the
atmosphere. (about.com)

12. “BRIDGE” BUSINESS PLANNING UNIT 12

Produce energy-efficient electronics and appliances.

Replacing an old refrigerator or an air conditioner with an energy-efficient model will save
the buyers money on their electricity bill and cut global warming pollution. Therefore, as a
production company the Blue Skies Group must turn towards eco-friendly products and get
the Energy Star label on new appliances. (about.com)

Support clean, renewable energy.

Renewable energy solutions, such as wind and solar power, can reduce our reliance
on coal-burning power plants. (sierraclub)

Plant a tree and make an eco-friendly work environment.

If you have the means to plant a tree, start digging. During photosynthesis, trees and other
plants absorb carbon dioxide and give off oxygen. They are an integral part of the natural
atmospheric exchange cycle here on Earth, but there are too few of them to fully counter the
increases in carbon dioxide caused by automobile traffic, manufacturing and other human
activities. A single tree will absorb approximately one ton of carbon dioxide during its lifetime.
Therefore, it is time to give the attention to the environment and take actions to make the
Blue Skies environment eco-friendly. (about.com)

Mount a local campaign against global warming.
Share information about recycling and energy conservation with other organizations, and
take opportunities to encourage public officials to establish programs and policies that are
good for the environment. Educate the people about Global Warming. This will be a great
help to safeguard and improve the public image. (sierraclub)


When companies publish the efforts they are making to conserve energy, reduce
emissions, and create solutions to the climate change problem, they can improve their public
image, which can generate direct benefits, in terms of greater acceptance of their products
and services, which is manifested in more sales, and the indirect benefits that a good public
image of the company brings, such as the attraction of customers, suppliers, and employees
who are committed to their efforts. (The associated content)

13. “BRIDGE” BUSINESS PLANNING UNIT 13

5. REFERENCES


Climate Change Impact– Economic losses, The Nature conservancy, Retrieved August 20,
2008 from http://www.nature.org/initiatives/climatechange/issues/art19627.html

Global Warming/Climate Change, What we can do about it, Retrieved August 20, 2008
from http://www.eartheasy.com/article_global_warming.htm

How Global Warming Affects Your Business Strategy, Retrieved August 20, 2008 from
http://www.associatedcontent.com/article/493635/how_global_warming_affects_your_bu
siness.html?cat=3

Nuttall, D. (2007) Carbon Dioxide emissions are only part of the story, Retrieved August
20, 2008 from http://www.associatedcontent.com

One man’s trash is another man’s fashion (2008, July 2) Retrieved July 17, 2008 from
http://www.msnbc.msn.com/id/25497155/

Stern Review on the economics of climate change, Retrieved August 20, 2008 from
http://www.hmtreasury.gov.uk/independent_reviews/stern_review_economics_climate_c
hange/stern_review_report.cfm

Ten things you can do to help curb Global Warming, Retrieved July 27, 2008 from
http://www.sierraclub.org/globalwarming/tenthings/

The leading edge of green, (2008, July7/July 14) Newsweek p 62

Top 10 Things You Can Do to Reduce Global Warming, Retrieved July 27, 2008 from
http://environment.about.com/od/globalwarming/tp/globalwarmtips.htm

Toyota, People and Technology creating a sustainable future. (2008, July7/July 14)
Newsweek p 64-65

Verve Energy Home page, Retrieved August 23, 2008 from
http://www.verveenergy.com.au