This post was contributed to the Future Summit blog by Simon Divecha, a Future Summit Australian Leadership Awardee. He is the Director of Green Mode and a keen climate change advocate. He can be found online at http://www.greenmode.com.au/ and on twitter at www.twitter.com/simondivecha

In the world of hard climate science, carbon pricing schemes and emissions targets you could be forgiven for thinking that human attitudes are rather unimportant. It sometimes appears that all we have to do is set a carbon price and everything else will follow.

It’s not that simple of course, despite the current difficulties focusing on cap and trade, carbon pollution reduction schemes or carbon taxes and caps.

Nicholas Stern, the ex Chief Economist of the World Bank and author of the UK government’s seminal Stern Review on the Economics of Climate Change highlights the issues by placing action, beyond carbon pricing, front and centre. He emphasises:

Three elements of policy for [carbon] mitigation are essential: a carbon price, technology policy, and the removal of barriers to behavioural change. Stern Review p.xxviii

And:

Behaviour is driven by a number of factors, not just financial costs and benefits Stern Review p.378

Yet worldwide we’re struggling to develop this focus. The humble light bulb is a great illustration.

Look around you. In nearly any country you will see incandescent light bulbs or halogen down lights. If you leave these lights in the sockets unchanged it is similar to walking past a $50 note on the pavement and not picking it up.

The improvements can be dramatic – Factor Ten (that is, a ten-fold improvement in the use of energy and resources.) This can mean a 90 percent cut in your business or personal costs and its possible to achieve it today - possibly saving ourselves $9 out of every ten dollars.

The picture shows one example – LED downlights. Available for between about AUD 10 and 20 dollars per light, the lights use 2 to 3 watts each. A normal downlight would use 50 watts.

These lights will pay for themselves

The lights shown in the picture will pay for themselves within 6 months. After this, it’s money in the bank. In addition they should last many times longer than an ordinary 50 watt halogen downlight. saving you or your business the time and cost of replacing ordinary bulbs.

But, for the last two decades while effective alternatives like compact fluorescent light bulbs have been available many people have, metaphorically, continued to walk past the $50 note. So we have to ask ourselves; to what extent are we motivated by money for saving power and the associated greenhouse gasses?

Of course the answer to climate change is not just about light – although the International Energy Agency finds we could cut global electricity consumption by almost 10% with similar changes. Nor is it (only) about changing light bulb jokes…. But it is a great illustration of profitable and meaningful change that delivers economic and environmental carbon advantages there for the taking.

It’s also an illustration of why we need to do more than just put a price on carbon. And why understanding individual perspectives and subjective worldviews are essential for addressing pressing global concerns like climate change.

As a start, and if you are unconvinced, have a look at the following prioritised list from Donella Meadows. The list categorises actions that impact a business in order of effectiveness - 9 being the least effective (and most commonly used):

9. Numbers - e.g. a carbon appraisal or setting internal reporting standards. Knowing what Carbon Pricing will do to supply chain costs.

8. Material stocks and flows. - e.g. tracking the flow of a material across business.

7. Regulating negative feedback loops. - e.g. internal and external audit.

6. Driving positive feedback loops - the more it works the more it gains power to work some more.

5. Information flows - e.g. peoples personal understanding and stories about products that are creating change.

4. The rules of the system (incentives, punishment, constraints).

3. The power of self-organization - e.g. a group creates/demonstrates a new response.

2. The goals of the business - is there / are there an overarching goal for the company?

1. The mindset or paradigm out of which the goals, rules, feedback structure arise. A shared ideal, changing an organisational culture.

For many, who agree with part or all of such a list, this is also about finding a Carbon Advantage. It’s far easier to do such a thing, find the opportunities from climate change, when many others around you are helping. And a lot of this advantage is with people’s attitudes, customer, staff and stakeholder views as much as it is in the future pricing signals, essential as such signals are.

Which takes us back to Nick Stern. Action on climate change and, by extension to find your carbon advantages, is about more than just pricing and numbers.

This post was contributed to the Future Summit blog by Simon Divecha, a Future Summit Australian Leadership Awardee, who recently visited Korea with the Australia Korea Foundation’s Next Generation Leaders Program (NGLP). What he has found is fascinating and provides a great portrait into what we can be doing in this ‘green economy.’

When we’re looking to the future Rahm Emanuel’s quote, never waste a serious crisis, keeps coming up. Over the last six months it’s been pushed heavily, particularly linking the global financial crisis to climate change action. Ex World Bank Chief Economist, Nicholas Stern, for example argues a significant part of financial stimulus should be directed toward green investment. So is it? And what’s significant?

When it comes to green investment it’s hard to go past current events in South Korea. Last year, at the 60th anniversary of South Korea’s independence, President Lee announced a new paradigm for the country – green growth. Translating words into action the country’s global financial crisis stimulus package of $38.5 billion USD is all focused on clean technology and environmental expenditure. The Korean Presidential Committee on Green Growth says it will deliver 956,000 new green jobs. The four year package is about 2.6% of Korea’s yearly gross domestic product. Funding goes to rivers, forests, clean transport and bikeways and, green homes and neighbourhoods.

At the same time this strategy is driving private investment. Samsung has just announced over 4 billion dollars of investment to green its electronics. It will cut the greenhouse gas embodied in its products by 50%. Once past the factory gate goods also use power and, Samsung says, its TVs, refrigerators and air conditioners will be the most efficient (lowest power use) products available. A month before this, JP Morgan announced it is raising $1 billion to invest in Korean solar, LEDs (high efficiency lighting) and green cars.

Renewable and very efficient energy projects also feature. A Korean stationary hydrogen fuel cell producing heat & electricity for 3000 homes is complete and should be commercially available next year. The plant uses 80% of the available energy from gas for a current cost of about AUD 0.23 per unit (the price of gas in Korea forming 50% of this cost). And the world’s largest tidal power plant can be found in Sihwa. It will deliver power at approximately half the cost of wind power. Hydrogen and tidal power plant pictures and detail are here. Cost comparisons here.

According to HSBC, the global stimulus funding directed at climate change is 436 billion US dollars. While Korea’s focus (about 80% of it climate related and the remainder on environmental initiative) is probably the greenest, globally nearly sixteen percent of economic stimulus expenditure goes on climate. In Australia this figure is just over nine percent, China it’s nearly thirty eight percent and in the USA it’s close to twelve percent.

So have the other countries missed the boat?

The crises that arise in the future from our greenhouse emissions will be with us for a long time even if all such emissions were to stop today. This implies we will find ourselves working to restore and revitalise the environment and the economic and social values that flow from such recovery.

There’s a stand out example of such action in Korea - the restoration of Cheong gye cheon – a project that converted 5.8kms of freeway through the heart of Seoul back to a river. Aptly titled Back to A future, this video tells the story.

For Australia with greenhouse gas emissions per person more than twice as high as Korea (a level South Australia’s Premier Mike Rann agrees puts us in the carbon obese category) we are also, perversely, in a strong position to lead. This is because answering climate change is as much about knowledge and adaptability as technological leadership. While the projected renewable energy growth in this country offers undeniable opportunities, ensuring effective change means more than just technology.

For example, much of the content for this blog came from my recent visit to Korea with the Australia Korea Foundation’s Next Generation Leaders Program (NGLP). Knowledge and expertise is highly valued – the NGLP group found ourselves writing advice for Korea’s president on the last day of our visit. In doing so we could draw on our own diversity, the group of 11 included at least 7 different country backgrounds or heritages and came with a depth of experience across the business, academia, government and non-government sectors. Such a mix, working to find solutions that are greater than the sum of the individuals involved, is something to be valued. Multiply this across Australia’s inherent multi-culturalisim, political growth and, struggles to answer challenges and maybe we’re starting to define a wealth of expertise that forms a significant competitive advantage.

We would do well to make the most this. In partnership with standout green technology and knowledge - as is occurring on commercial scales in South Korea - it has the promise to be a fascinating, productive and valuable mix.

Quick facts

South Korea

Population 48.5 million (2009)

GDP 1,280 billion USD (2008)

CO2-e per capita 11.1 tonnes per person (2000)

Australia

Population 21.3 million (2009)

GDP 800 billion USD (2008)

CO2-e per capita 30.3 tonnes per person (2005)