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John Chambers, CEO, Cisco

Climate Change: A Challenge and an Opportunity for Business Innovation

“Make yourself relevant.”

This was the challenge Yvo De Boer, Executive Secretary of the United Nations Framework Convention on Climate Change, posed to business leaders recently gathered in Copenhagen before negotiators agreed to first steps to mitigate the impact of human activity on the environment. While Secretary De Boer acknowledged many of the valuable contributions made by businesses thus far in addressing climate change, he believes we could do more, and I agree. This is clearly a call to action for me and other leaders to step up our current engagements as world leaders work to finalize the details of a binding global agreement.

The issue of climate change was tailor-made for business: it’s a complex problem that requires a vision, a differentiated strategy, and a detailed plan for execution. It demands new business models, innovative technologies and global collaboration along with partnerships across the public and private sectors. The ability to balance innovation with operational excellence is a key principle of business, and the tech sector in particular.

For example, new technologies show how much energy and water buildings use and the amount of greenhouse gas emissions they emit. New industries are emerging out of the opportunity to harness the power of the sun, to fuel automobiles with zero emissions, and to identify new forms of energy. The build out of a dynamic smart grid will allow us to better manage energy delivery and consumption, while creating entirely new business models for the utility industry. These kinds of advancements will lay the foundation for progress on climate change and will spur job and economic growth in the process—and we all understand that jobs and job creation will be the key to fueling our economy for many future generations to come.

Now, with government policies in place to promote clean energy, as well as with Silicon Valley venture capital investment on the rise, we have never been better positioned to take advantage of these opportunities. Keeping Mr. De Boer’s remarks in mind, here are some examples of where business and innovation are already relevant—and where we could be doing more.

Commit to Something Meaningful

Cisco was proud to support the Copenhagen Communiqué on Climate Change, which is widely-recognized as the definitive statement from the international business community urging progress on energy management and climate change. Signed by approximately 1,000 companies, including PepsiCo, Gap, General Electric, Kraft Foods, Nike, Starbucks and more, this document represents a collective call to action for climate change.

The Communiqué calls for establishing a global emission-reduction pathway from 2013 to 2050, with interim targets to ensure cuts are made along the way. It urges developed countries to make immediate emission-reduction commitments that are much higher than the global average; and encourages developing countries to do their part by forging their own emission-reduction plans, building toward the adoption of economy-wide commitments by 2020.

While we are encouraged by the progress made in Copenhagen over the last two weeks, a legally- binding agreement acceptable to all nations—one that is bold enough in vision and implementation is the only viable course that will lead to emissions reductions significant enough to save us from a near-certain climate crisis. Business and government must work together to reach these commitments and use innovation to drive progress as an agreement takes hold.

Lead by Example

As we ask nations to commit to emissions reduction goals, we must do the same. In business and in government, we have to set the example. As a company, Cisco has set a goal to reduce our own carbon emissions in absolute terms 25 percent by 2012. We will accomplish this ambitious goal by using our own technology, from better energy management in our buildings to using collaborative technologies such as Cisco TelePresence, the latest in virtual meeting technology which has allowed us to reduce our travel company-wide by two-thirds in less than two years. Cisco also established the Global Climate Change Meeting Platform (GCCMP) which connected participants at the Bella Center in Copenhagen with more than 100 locations worldwide via TelePresence. The GCCMP will be active over the next year, allowing climate change stakeholders to virtually meet and help ensure further cooperation, agreement and enactment of a global agreement while minimizing emissions from air travel.

Implementation of a binding agreement and realizing its benefits will take time. So, as a business community, we need the government’s support of “quick-start” initiatives beginning in 2010. The World Economic Forum’s Low Carbon Prosperity Task Force set out a series of these ideas such as technologies to aid deforestation, carbon capture and storage demonstration projects, smart grid pilot projects and information communications technologies for energy efficiency. Combined with investments from governments and concrete plans, these steps can move us more quickly in the right direction.

Be Visible and Vocal

Some businesses are waiting to make stronger efforts to monitor their energy and emissions until policymakers tell them what they are required to do—this is not the right approach. Businesses, industry sectors and even nations that do not embrace green innovation and technologies, along with those who don’t make commitments to reduce their own carbon footprint, are missing this major market transition. For instance, by implementing building energy management technologies, businesses can cut their related cost and carbon impact significantly while improving their operations. Investment in new technologies such as wind, solar and Smart Grid will reduce our dependency on foreign oil and create high-skilled jobs. Business leaders should champion the benefits of “going green.” We must be transparent in not just our business performance, but our environmental focus; and we must engage our peers and our political leaders in a debate about the importance of taking action.

In other words, we have an obligation to make business relevant. Mr. De Boer is definitely on to something.