Corporate Responsibility In Tackling Climate Change: BHP Billiton's Essay.

Identify a research question and define the terms for their project. For example, “disclosures” for climate change could relate to - reporting amount of carbon emissions, narrative on the use of renewables or even images of climate change (e.g. weather patterns, drought, floods etc)

Prepare an overview of the literature related to accounting and the topic.

Present findings in written, graphical or tabular form with an explanation of how the data was chosen and collected.

Discuss the findings in relation to the research question and reflect on the literature or a theory studied in ACCY903.

BHP and its Impact on Climate Change

The research report would strive to focus on the aspect of corporate responsibility of the business organisations in response to the environmental issues leading to climate change due to changes in weather patterns, floods and droughts amongst others. The paper would focus on the corporate responsibility delivered by the Anglo-Australian mining organisation, BHP Billiton and its effort in containing the adverse impact of climate changes. BHP has been listed as one of the 90 business organisations extracting fossil fuels leading to emission of two-thirds of the greenhouse gases. It is estimated that 10% of the emissions are due to direct operations of BHP, say mining and 90% due to its product. The passage of time made BHP a responsible business organisation investing worth $77 million for the communities across the world (BHP, 2018).

According to McMullan (2017), carbon accounting takes into consideration various business practices to varied segment of people to quantify the physical level of greenhouse emission to the atmosphere as physical carbon accounting. It also comes up with financial market worth of the emitted level of Co₂ as the financial carbon accounting. The physical carbon accounting emulates the greenhouse gas inventory indicating the level of carbon-di-oxide emitting off the process to set forth a reduction strategy for the businesses around (Carcello, et al., 2011).

The industrial activities has led way to the phenomenon of global warming raising the Earth temperature to 1.62⁰ Fahrenheit since late 19^th century. So according to McKinley et al., (2015), the business houses are apparently responsible for an increase level of CO₂ in the environment and ethically they need to take measures in repairing the damages for a sustainable future. In this scenario carbon accounting paves a significant role as it strives the businesses across the industries to undertake requisite measures (McMullan, 2017). This phenomenon enable the businesses to fight the menace of climate change through a range of social activities like tree plantation, minimising carbon emission and environmentally friendly activities and disclosing it to the stakeholders as responsible businesses. It is also the due responsibilities of multinationals like BHP to disclose facts and figures in context to their environmental sustainable measures for a cleaner tomorrow (UNDP, 2019).   

BHP being a responsible business house has accepted the evaluation of Intergovernmental Panel on Climate Change (IPCC) on the aspects of climate change leading to the global warming phenomenon. The disclosure made by the institution from 2016 to 2018 show its realisation in understanding the adverse impacts of fossil fuels, placement of low emission technologies and requirement of an energy efficient scenario in the business environment (Carcello, et al., 2011). FY2018 had ushered in a new hope on part of BHP as it strived to conceive a 5-year greenhouse gases (GHG) reduction program to attain a lower level of operational emission by FY2022 (BHP, 2019). The operational emission of BHP has increased by 1% in FY2018 emitting 16.5 million tonnes of CO₂ against FY2017. 

Carbon Accounting and Financial Measures

BHP has disclosed the annual emission level of its greenhouse gases throughout the years and since FY 2016 took the pledge to achieve a net-zero operational GHG emission in alignment to the Paris Agreement as a longer term goal. These facts has been specifically disclosed in the annual statement of the organisation from 2016 to 2018 and achievement of those targets serve as significant benefactor to enhance the internal performance of BHP (O'riordan, 2014). The disclosure off the mining organisation has revealed for undertaking a number of measures like usage of zero-carbon materials and electricity along with investment in low emissions technical expertise to minimise the extent of climate change substantially.

The paper would take consideration of the positivism research philosophy as it requires to explore the natural evidences of the subject matter (Neuman, 2013). Accordingly the paper would strive to disclose the measures and activities undertaken by BHP to minimise the emission of greenhouse gases off its mining and manufacturing activities.

The research would be contemplated by means of inductive research approach as it gives due stress on the existing elements to analyse the current scenario (Carcello, et al., 2011). The deductive research approach would be helpful in understanding the strategies and activities contemplated by BHP as direct approach to solve the crisis of climate change.

The significance of data seems to be quite crucial in the business scenario and for the purpose of the study, secondary research data would be applicable. The secondary data would be sourced from various journals, publication, newspaper articles and online website of BHP disclosing its initiatives in countering the climate change menace for a better and cleaner tomorrow (Creswell, 2014).

The research would deal with the qualitative research methods providing an insight of the measures and activities adopted by the business to address the climate change issue (Brandenburg, et al., 2014). The non-quantifiable elements would be used in this regard to point out the concerning areas of climate change that has been highlighted by BHP with inputs from the management.

It is seen that BHP has strived to re-establish itself as a responsible business organisation committing itself to the cause of environment in FY2016 by investing $77 million for the purpose (BHP, 2019). The mining firm has adopted environmental friendly policies like zero-carbon electricity supply to bring down the 46% operational emission level off electricity usage. The materials used by BHP like distillates and fuels contribute unto 35% of operational emission which is to be countered by adopting innovative and alternative fuels against diesel consumption. Then there are fugitive methane emissions off coal and petroleum contributing 18% of operational emission to be mitigated through technologically and economically efficient means (European Environment Agency, 2018). BHP has been experimenting with alternative technologies since 2016 in its Olympic Dam sites in South Australia by deploying electric vehicles for mining and manufacturing activities against usage of diesel transportations.

BHP's Efforts in Reducing Greenhouse Gas Emissions

The findings point out the fact that BHP is very much committed to fight out the menace of climate change by installing technologically efficient means to deliver a positive and environment friendly expertise for reducing the extent of GHG.  BHP has also attempted for the Lakeland Solar and Storage Project to use solar energy as an extensive resource in the Australian territory of Queensland (Furnham & Gunter, 2015). The organisation made it a practise to have a transparent disclosure and reporting mechanism to get actively engaged with its stakeholders like the investors, communities and policy makers to have its full support in delivering a cleaner tomorrow.

BHP graduates as a full-fledged responsible organisation by disclosing its financial commitment and targets as per the recommendations of the Task Force on Climate related Financial Disclosures since 2016 (TCFD). BHP has strived to track its progress on reducing the level of emission by disclosing that FY2018 has experienced a 1% rise in its emission activities amounting to 16.5 million tonnes of CO₂ against FY2017 (McKinley, et al., 2015). It apparently shows the commitment level of BHP in countering the extent of climate change through its effective means and innovative activities for the specified period of 2016 to 2018.  

Conclusion:

The paper shows that BHP attains to establish itself as an environmentally responsible organisation and strives to fulfil its environmental goal by reducing the level of carbon emission off its manufacturing and mining activities by means of carbon accounting. It is astonishing to see the commitment level of the company to reduce the aspect of carbon emission despite having 1% rise in its CO₂ level and undertaking environmental friendly measures to fight the menace of global warming. BHP has disclosed strategies like usage of zero-carbon materials and electricity along with investment in low emissions technical expertise to minimise the extent of climate change substantially. BHP took due relevance of international organisations like IPCC, UN, TCFD and European Environment Agency to frame its environment policies and financial measures for an efficient and responsible functioning. Projects like Lakeland Solar and Storage Project in Queensland and Olympic Dam sites in South Australia are showing effective implications on the organisational part to find out a sustainable solution for the environment in the upcoming period.   

The paper attempts to have an insight on the environmental policies adopted by the multinational mining company, BHP to counter the menace of climate change off the emission of greenhouse gases. The aspect of carbon accounting in BHP show its responsibility in emitting two third of the carbon emission activities and so it is quite favourable for the company to undertake needful measures to bring down the carbon emission level. BHP seems to be very desperate in curbing the CO₂ level as it committed around $77 million for having a clean environmental policy. In this regard BHP abides by the international organisations like IPCC, UN, TCFD and European Environment Agency to frame its environment policies and disclose financial aspects to have a transparency scenario for its stakeholders.

The research points out that BHP to tackle the issue of climate change had conceived a 5-year greenhouse gases (GHG) reduction program to attain a lower level of operational emission by FY2022. The research took assistance of the secondary resources to source relevant materials and information from the articles and online websites of BHP to find out the strategies undertaken to reduce the carbon emission level. In this context projects like the Lakeland Solar and Storage Project in Queensland and Olympic Dam sites in South Australia are worth mentioning as it is in pursuance of an alternative and energy efficient means to have an effective solution of the carbon emission measures.

References

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Carcello, J., Hermanson, D. & Ye, Z., 2011. Corporate governance research in accounting and auditing: Insights, practice implications, and future research directions. Auditing: A Journal of Practice & Theory, 30(3), pp. 1-31.

Creswell, J. W., 2014. Research Design. Qualitative, Quantitative & Mixed Methods Approaches. London: Sage publications.

European Environment Agency, 2018. Understanding and acting on the complexity of climate change. [Online]
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Furnham, A. & Gunter, B., 2015. Corporate Assessment (Routledge Revivals): Auditing a Company's Personality. London: Routledge.

McKinley, D. et al., 2015. Investing in citizen science can improve natural resource management and environmental protection. Issues in Ecology, 2015(19), pp. 1-27.

McMullan, R., 2017. Environmental science in building. New York: Palgrave Macmillan Education.

Neuman, W., 2013. Social research methods: Qualitative and quantitative approaches. Sydney: Pearson education.

O'riordan, T., 2014. Environmental science for environmental management. Sydney: Routledge.

UNDP, 2019. Sustainable Development Goals | UNDP. [Online]
Available at: https://www.undp.org/content/undp/en/home/sustainable-development-goals.html
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