Introducing Green Targets for Corporates

Synopsis: The government can introduce green targets and obligations on corporates. Adoption of such targets will help the global fight against climate change.

Introduction: 

The massive levels of production, consumption, and disposal of goods and services benefited economic growth. But it slowed the replenishment cycle of limited resources. This is evident from the impacts of Climate Change.

Both the consumers and corporations have to equally bear the growth of large-scale manufacturing and services and their impact on Climate Change. So the loss of resources and increase in greenhouse gas emissions is the responsibility of both the consumers and corporations.

Consumers can reduce their usage through awareness campaigns. But so far, everyone is focussing on sustainable efforts by the government and their policies. But the impact of corporations is neglected. Indian corporations can become a major help in India’s story of sustainable growth by achieving ‘green targets’.

 

What are Green targets?

These are commercial contracts. Under this, the contracting parties set a mandate to cut down greenhouse gas emissions at different stages of delivery of goods/services. This includes all the phases of industry such as design, manufacturing, transportation, operations, and waste disposal.

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How India can enforce Green Targets?
  1. The government can introduce the green targets when the companies participate in the tender process. During these ‘green tenders,‘ the government can introduce ‘Green qualifications’. This includes a range of qualifications from pre-defined usage of ‘green energy’ to adequate on-site waste management, reducing carbon emissions, etc.
  2. Once the bidding process is complete, then the government can sign a contracting agreement(green contract). Under this, the government can prescribe the ‘green obligations’.
  3. These green contracts are necessary as this makes the obligations binding and legally enforceable for the corporates. Further, these green contracts will vary from one industry to another.
  4. Thus, the green targets can help in cutting down emissions. The targets can provide good quality and energy-efficient infrastructure, reducing noise, air, and water pollution and ensuring eco-friendly means of transportation within corporates like bicycles, etc.
How to enforce these ‘green obligations’ and achieve ‘green targets’?
  1. The government can formulate measurement criteria and conduct performance audits against these ‘green obligations’.
  2. During these, the government has to identify the non-performer. Further, the government has to prescribe penalties for non-compliance with such green obligations.
  3. The government can also make the green obligations trickle down to all levels of the supply chain.

The economic cost of executing green contracts may be greater than normal contracts. But the corporates have to undertake such green targets to attain greater benefit to the environment.

Source: The Hindu


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