Environmentally Sustainable Businesses, Energy Transition, and Climate Finance

This chapter introduces Part III on Environmental Implications of sustainability. It discusses how environmental sustainability has become a critical matter for stakeholders, and also provides a unique opportunity for businesses to enter a potentially lucrative and high impact area of the economy. While presenting risks for businesses and investors, environmental sustainability also presents an opportunity amounting to trillions of dollars for those developing and scaling successful solutions. The chapter highlights how, in the past few decades, there have been increased stakeholder expectations for corporate environmental responsibility, which has transformed the business landscape. Consumers, investors, NGOs, and regulators are now pressing companies to account for their environmental impact. The chapter introduces the European Union (EU) Taxonomy for sustainable activities. It presents the concept of a circular economy which aims to reduce waste and improve product design to optimize recycling. It explores climate change mitigation for companies, touching on greenhouse gases, net-zero targets, the energy transition, and the critical importance of carbon removal solutions. It then covers adaptation strategies. The chapter concludes by calling attention to the need to develop and scale economically viable carbon capture technologies. It emphasizes that, while necessary, the energy transition alone may not be sufficient to tackle climate change given the long lifespan of carbon dioxide in the atmosphere. Carbon capture and transformation technologies following the circular economy model, such as mineral carbonation, are particularly promising as they would transform carbon dioxide, a threat, into a valuable resource.