Business Strategy of Climate Change: Empirical Study of the Steel Industry Sector

There is a broad scientific consensus that our plant is warming and that post industrial revolution human activities are contributing significantly to the process. If global warming continues at the present and projected pace, it will cause significant damages to the global eco-system upon which humans are dependent. There is also a consensus that in order to limit the temperature rise to 2 degrees Celsius and prevent risky anthropogenic interference with the climate system, it is critical to stabilize carbon dioxide (CO2) concentration at no more than 550 parts per million (ppm). The latest report published by the Intergovernmental Panel on Climate Change (IPCC) in 2007 calls for the developed countries to reduce their CO2 emissions 60% by 2050 relative to the present level and for the developing countries to control their emissions starting around 2030. As the first tangible step to cope with global climate changes, countries adopted the UN brokered, ‘Kyoto Protocol,’ that was developed in 1997. Under the Protocol, the European Union (EU) and Japan established targets to reduce greenhouse gas (GHG) emissions by 8% and 6% respectively between 2008 and 2012 relative to 1990. The developing countries including China, Brazil and India ratified the Protocol without specific emission reduction targets. Two countries with the highest CO2 emission releases per capita, the United States and Australia did not ratify the Protocol (In December 2007, however, Australia ratified the Protocol as soon as Rudd was elected as the prime minister). Intensive discussion has begun among policymakers and policy-minded social scientists with regard to how to include these countries in the post Kyoto regime. At Conference of the Parties (COP) 13 which took place in Bali, Indonesia in December 2007, the negotiators attempted to agree on the schedule for the discussion of the post Kyoto regime. As we know, the Kyoto Protocol is only the starting point of the forthcoming marathon-like multilateral negotiations.