How accountants can help fight climate change ? | Eu-Lin Fang | TEDxESSECAsiaPacific
Summary
TLDRYulin, an accountant turned sustainability expert, discusses the pivotal role of accountants in combating climate change. She traces the history of accounting principles established by Luca Pacioli, which fostered trust in commerce. Yulin emphasizes the urgency of addressing climate change, highlighting the critical levels of CO2 in the atmosphere and the global temperature rise. She introduces the 1.5 and 2-degree Celsius benchmarks, explaining their significance to our future. Yulin points out the challenges in measuring and reducing carbon emissions but expresses optimism in technology, nature-based solutions, and collective action. She argues that accountants, with their expertise in measurement and verification, are uniquely positioned to contribute to climate change mitigation, urging everyone to join the fight for a sustainable future.
Takeaways
- π The principles of accounting, including debits and credits, were established by Luca Pacioli in his book 'Summary of Arithmetic, Geometry, Proportions, and Proportionality', which laid the foundation for trade and commerce development.
- π± Yulin transitioned from a financial auditor to a sustainability and climate change professional, highlighting the relevance of accounting in environmental issues.
- π’ The current CO2 concentration in the atmosphere is at 418 parts per million (ppm), which is significantly higher than the natural levels of 200-300 ppm over the past 800,000 years.
- β οΈ An increase of 1.1 degrees Celsius in global temperature since pre-industrial times is already causing noticeable effects, with scientists warning of more severe impacts at 1.5 and 2 degrees Celsius increases.
- π The world's coral reefs, wheat production, and overall climate stability are at risk with higher temperature increases, emphasizing the urgency to limit global warming to 1.5 degrees Celsius.
- π There are approximately 51 gigatons of CO2 in the atmosphere, which is equivalent to 51 billion tons, and scientists advise halving emissions by 2030 to stay within a 1.5-degree scenario.
- π Despite the global slowdown in 2020 due to COVID-19, carbon emissions only decreased by 6-7%, indicating the enormity of the challenge to meet decarbonization targets.
- π‘ Three areas of hope in combating climate change include technology and innovation, nature-based solutions, and community, business, and government collaboration.
- πΏ Accountants can play a pivotal role in fighting climate change by leveraging their expertise in measurement, disclosure, adding credibility, and driving change in sustainability standards.
- π The future envisioned by Yulin includes a shift to electric vehicles, renewable energy sources, and a commitment to education and clean air for all, making it a future worth fighting for.
Q & A
What significant event happened in 1494 that influenced accounting?
-In 1494, Luca Pacioli, a Franciscan friar and mathematician, published the book 'Summary of Arithmetic, Geometry, Proportions and Proportionality' which helped establish the principles of accounting, particularly around debits and credits.
Why are debits and credits important in accounting?
-Debits and credits are fundamental to accounting as they form the basis for recording financial transactions, enabling the maintenance of financial records and the preparation of financial statements that instill trust and accountability among investors and stakeholders.
What is the significance of the number 418 ppm in the context of climate change?
-418 ppm refers to the concentration of carbon dioxide in the atmosphere, measured in parts per million. It is significant because it indicates a level that is higher than the natural oscillation range of 200-300 ppm, which has been the norm for approximately 800,000 years.
How does an increase in carbon dioxide levels affect the Earth's temperature?
-An increase in carbon dioxide levels leads to more greenhouse gases in the atmosphere, which trap heat and cause the Earth's surface temperature to rise.
What are the potential consequences of the Earth's temperature rising by 1.5 degrees Celsius?
-At 1.5 degrees Celsius of warming, scientists predict that 70 to 90 percent of coral reefs will vanish, reproduction in certain species will decrease by seven percent, and there will be a significant reduction in wheat production in the tropics.
What is the difference between the impacts of a 1.5 degrees Celsius and a 2 degrees Celsius temperature rise?
-At 2 degrees Celsius of warming, the negative impacts are more severe, with 99 percent of coral reefs expected to vanish, a 16 percent reduction in wheat production in the tropics, and an increased frequency of heatwaves and extreme weather events.
How many gigatons of CO2 are emitted into the atmosphere annually, and what is the goal to limit global warming to 1.5 degrees Celsius?
-Currently, approximately 51 gigatons of CO2 are emitted into the atmosphere annually. To limit global warming to 1.5 degrees Celsius, scientists recommend halving these emissions by 2030 and reaching net-zero emissions by 2050.
What was the reduction in global carbon emissions during the COVID-19 pandemic in 2020?
-Despite the significant reduction in global activities during the COVID-19 pandemic in 2020, the decrease in carbon emissions was only around 6 to 7 percent.
What are the three areas of hope mentioned in the transcript for combating climate change?
-The three areas of hope mentioned are technology and innovation, nature-based solutions, and community, businesses, and governments setting ambitious targets to confront and fight climate change.
How can accountants contribute to the fight against climate change?
-Accountants can contribute by measuring and disclosing greenhouse gas emissions, adding credibility through verification of carbon offsets, and driving change by influencing global governance and reporting standards related to sustainability.
What is the role of accountants in ensuring trust and accountability in the context of ESG (Environmental, Social, and Governance) reporting?
-Accountants play a crucial role in ESG reporting by applying their expertise in measurement, disclosure, and verification to ensure the accuracy and reliability of sustainability information, thereby fostering trust and accountability among stakeholders.
Outlines
π± The Pivot to Sustainability
Yulin, an accountant by profession, narrates her transition from financial auditing to sustainability and climate change. She poses a question about the relevance of accountants to climate change, promising to address it later. Yulin takes us back to 1494 during the Italian Renaissance, introducing Luca Pacioli, a mathematician who published 'Summary of Arithmetic, Geometry, Proportions, and Proportionality,' which laid the foundation for modern accounting principles, particularly the use of debits and credits. These principles are crucial for financial transparency and trust, enabling investors and stakeholders to make informed decisions. Yulin emphasizes the historical significance of these principles in fostering trade and commerce.
π‘οΈ Climate Change: The Urgent Numbers
Yulin shifts the focus to climate change, presenting the current CO2 levels in the atmosphere at 418 parts per million (ppm), a level significantly higher than the natural oscillation range of 200-300 ppm over the past 800,000 years. She explains the rapid increase in CO2 levels due to industrialization and its impact on global temperatures. Yulin highlights the difference between a 1.5-degree Celsius and a 2-degree Celsius increase in global temperatures, noting the severe consequences of the latter, such as the near-total loss of coral reefs, reduced crop yields, and increased frequency of extreme weather events. She stresses the importance of reducing carbon emissions to stay within a 1.5-degree Celsius increase, pointing out the challenge of halving emissions by 2030 and reaching net-zero by 2050.
π Hope Through Technology and Action
Despite the daunting challenge of decarbonization, Yulin expresses optimism, citing technology and innovation, nature-based solutions, and collective action as key areas of hope. She mentions the significant advancements in renewable energy and carbon capture technologies. Yulin also discusses the role of forests and mangroves in sequestering CO2. She notes the increasing commitment from businesses and countries to achieve net-zero emissions, with many doubling their commitments in 2020 despite the COVID-19 pandemic. Investors are also showing interest in companies with strong climate and ESG (Environmental, Social, and Governance) resilience, indicating a growing market demand for sustainable practices.
π The Role of Accountants in Climate Change
Yulin argues for the critical role of accountants in combating climate change. She suggests that accountants' expertise in measurement, disclosure, and verification can be applied to climate-related data, enhancing credibility and trust. She points out the need for standardized sustainability reporting and the potential for accountants to drive change in this area. Yulin also observes a growing interest among young accountants to engage in climate action, using their skills to contribute to a sustainable future. She concludes by envisioning a future with clean energy, clear skies, and equal educational opportunities, emphasizing the importance of fighting for such a future in every professional capacity.
Mindmap
Keywords
π‘Accountant
π‘Sustainability
π‘Climate Change
π‘Carbon Dioxide (CO2)
π‘ppm (Parts Per Million)
π‘Decarbonization
π‘ESG
π‘Coral Reefs
π‘Renewable Energy
π‘Carbon Offsets
π‘Global Governance
Highlights
Yulin, an accountant, transitioned to sustainability and climate change, showcasing a career pivot from financial auditing.
Luca Pacioli, a Franciscan friar and mathematician, published 'Summary of Arithmetic, Geometry, Proportions, and Proportionality', establishing foundational accounting principles.
Accounting principles of debits and credits are crucial for trade and commerce development, fostering trust and accountability among investors and stakeholders.
The speaker emphasizes the importance of financial information in making investment decisions, highlighting the balance between trust and accountability.
Carbon dioxide levels in the atmosphere have reached 418 parts per million, a significant increase from pre-industrial levels.
Pre-industrial levels of carbon dioxide were stable between 200-300 ppm for over 800,000 years, with changes occurring over long time frames.
The increase in CO2 levels post-industrialization has led to a rise in Earth's surface temperature, with current levels at 1.1 degrees Celsius above pre-industrial times.
Scientists warn of drastic environmental changes at 1.5 and 2 degrees Celsius increases in global temperature, including coral reef loss and reduced agricultural yields.
The current atmospheric CO2 is equivalent to 51 gigatons or 51 billion tons, requiring significant reduction to meet climate goals.
To stay within a 1.5-degree Celsius increase, emissions need to be halved by 2030 and reach zero by 2050.
Despite the COVID-19 pandemic and reduced activities in 2020, carbon emissions only decreased by 6-7 percent, indicating the scale of the challenge ahead.
Three areas of hope in combating climate change include technology and innovation, nature-based solutions, and community, business, and government action.
The number of companies and countries committing to net-zero emissions doubled from 2019 to 2020, showing growing commitment despite global challenges.
Investors are increasingly interested in companies with strong climate and ESG (Environmental, Social, and Governance) resilience.
Accountants can play a pivotal role in the fight against climate change through measurement, disclosure, adding credibility, and driving change.
The future envisioned by the speaker includes a shift from fossil fuels to renewable energy sources and a world with clear blue skies and accessible education.
Every individual, regardless of their role, has a part to play in fighting climate change, emphasizing collective responsibility and action.
Transcripts
[Music]
hello everyone
my name is yulin and i'm an accountant
for a good proportion of my
professional career i was a financial
auditor
but a few years ago i pivoted to
something else
so nowadays when people ask me yulin
what is it that you do
that's it i'm in sustainability and
climate change
then they ask me how is it that you can
become
from accountant to become in climate
change
then also they asked me this question
what do
accountants have to do with climate
change
well i'll answer that question in a bit
but first
i wanted to take you to this year about
500 years ago
1494. now this year is pretty special
it was the period of the italian
renaissance
so there was art and also commerce
booming
in italy and there was a man
a franciscan friar a mathematician
called luca pacioli
so luca pacholi was a mathematician
and he created and published this very
important book
called the summary of arithmetic
geometry
proportions and proportionality it's a
bit of a mouthful but it's actually a
very important book
it's so important because it actually
helped to establish
the principles of accounting
particularly around
debits and credits many people have said
that it's because of these principles
that trade
commerce continued to develop
so maybe let me give you an example why
are these principles so important
say you are an investor okay you want to
have a look
at a company on whether or not to invest
and you say
let me have a look at those financial
information the financial statements
so you get the financial statements and
you turn to the balance sheet and you
say
hmm pretty healthy balance sheet return
to the p
l and say lots of profits as well i'll
invest in this company
so these financial information actually
engenders
trust and accountability
and it's these principles that have been
used by accountants
that have been actually also relied on
by investors
and also stakeholders that engendered
trust and accountability
now i want to move on to another topic
something that is i think close to
everybody's heart
in this audience today something that
affects all of us
your families your future families
investors companies as well
and something that i feel now that i'm
in this space we haven't properly
accounted for
and we also haven't been felt
accountable to
and guess what that that the issue is
climate change i want to now
dish out three numbers and also three
letters
418 ppm what is 418 ppm
so firstly ppm stands for parts per
million
and that's a measure of the
concentration in carbon dioxide
in the atmosphere 418 is the level
of the carbon dioxide in the atmosphere
and
it's not a good level let me tell you
why
so as far as we could actually record
the amount of carbon dioxide in the
atmosphere and we could go back pretty
long time and quite surprised
800 000 years the carbon dioxide is
always
oscillated between 200 and 300 parts per
million
never above 300 and the changes
in the oscillation of carbon dioxide
over 200 to 300 ppm
it occurred over tens and thousands of
years
so very long time frames and the earth
could adapt accordingly
naturally but something happened
about 100 plus years ago
pre-industrialization happened
and our parts per million managed to
actually go through the
300 ppm level and smash
through 400 ppm so
we are here at 418 ppm
and some might ask like what's the big
deal
it's just a number some of you may know
that greenhouse gas emissions actually
traps
heat in the atmosphere greenhouse gases
like
carbon dioxide that increases
the surface temperature of earth so some
ask me so
exactly how much has the temperature
increased from pre-industrial levels
i'll show you a number
1.1 degree celsius from pre-industrial
levels
people always ask me actually that is
quite trivial
what's the big deal about 1.1 degrees
celsius
actually people are already feeling the
effects of climate change
even at this level i'll share with you
two other numbers
1.5 and 2 degrees celsius
scientists always talk about these two
numbers 1.5 and 2.
people always tell me what's the big
deal what's the difference
and i say actually there's a world of
difference
scientists say that in the 1.5 degrees
celsius world
70 to 90 percent of our coral reefs will
vanish
and in a two degree celsius bowl 99
and another case in point in the 1.5
degrees celsius bowl
we talked about reproduction decreasing
by seven percent
and in the two degrees celsius well that
will increase to
16 reduction in wheat production in the
tropics
scientists are also saying that in a two
degree celsius world
there will be more heat waves and
extreme weather events as well
so scientists are saying please try to
keep it
at 1.5 degrees celsius
now that we understand why it is
important
to cap that increase to 1.5 degrees
celsius
people often ask me so how much of this
carbon dioxide is there in the
atmosphere
how much of it and i said to understand
this let me show you this picture
so this picture here is a orange ball
but it's a very special orange ball it's
actually a very big orange ball
probably larger than this or taller than
the stage
it's two stories high and it represents
one ton
of co2 people ask me
so how much of these orange balls if it
represents one ton of co2
are there in the atmosphere i'll give
you another number
51 gigatons which actually translates to
51 billion of these balls in the
atmosphere
being emitted every year scientists say
if you want to keep within a 1.5 degree
scenario you can
but you need to half those emissions by
a time frame
20 30 which is eight to nine years time
and then
you need to get it to zero by twenty
fifty
you might think so is this very tough or
what
well based on the study by pwc
of the g20 countries which is the
largest countries in
the world you need to decarbonize by
11.7 percent a year
to get to that 1.5 degree scenario
so you say actually quite doable maybe
we can get there
but i'll give you a reference point
last year 2020 was the year
where covet was raging
lots of business stopped we had the
circuit breaker
we had lockdowns activities decreased
planes or airports shut down hazard a
guess
about the decrease of carbon emissions
during the year of 2020 has it a guess
close not close sorry it was
unfortunately only seven percent
some sources even say six percent
when i saw this number i said to myself
oh my goodness despite
all this reduction in terms of
activities
we only decrease our carbon emissions
around the world
by to six to seven percent
how are we going to decarbonize the
whole world henceforth
but you know something there are three
areas that actually give me hope
let me share with you the first area
is technology and innovation my first
ball of hope
including innovation in sustainable
finance
and there's a really great innovation
that's happening
with renewable energy and even in
geoengineering
like carbon capture
the next area of hope i think is
nature-based solutions
using inland forests and mangroves to
sequester
the carbon dioxide in the atmosphere and
last but not least
the third one which i think is us
the community businesses governments
individuals setting ambitious targets
coming together to confront and to fight
climate change you know
during 2020 i thought there was
a lot of issues in the world kovit was
raging
and i thought you know i think climate
change would be in the back burner
but i was very surprised in 2020
the number of companies and also the
number of countries
that actually committed to net zero had
doubled
from 2019. you had
japan new zealand south korea
china all saying that it would be carbon
neutral
and then just this year you have the u.s
that's it they will slash their carbon
emissions
by half by 2030.
i think this is good news we also talked
about investors
investors as well are very interested in
companies who are climate and esg
resilient
so the ambition is there i think there's
lots of work to do
so how is it that we can keep companies
organizations accountable
and decrease the carbon emissions
just now i talked about financial
information
actually the financial information world
is actually a very well
[Music]
taken and also a very clear path very
well traveled path
however in the esg area or the climate
area
the path is less well traveled
and also it's foggy let me explain why
well firstly there are quite a number of
sustainability
and climate related standards around
so people will use different different
organizations would use to some
standards
this actually makes it very difficult
for stakeholders and also
investors to cast and compare it can be
confusing
the next area is about carbon
footprinting or carbon measurement
well to be honest i don't think all
companies actually know what's their
carbon footprint
and even if they're measuring the carbon
footprint
they're not measuring it completely
there are no complete boundaries there's
also no complete measurement of their
scopes
as well so how do you actually then
baseline your carbon emissions
set meaningful targets to actually
decarbonize
you can't do it it just surprises me
that in an area where trust and
accountability is most needed
in the climate and esg area that
there's not much of it
so when people ask me
you len who do you think can help in
this
what do you think we can do and i say
actually i think accountants can help in
this i think
accountants are able to fight climate
change they can save the world
and then people say you learn you're mad
i say yeah i think accountants can be
mad
i think accountants can be mad for
climate change and let me tell you why
firstly measurement and disclosure
accountants have been doing this for
hundreds of years
they have been great at measurement and
accounting
and also disclosures this is going to be
a very natural adjacency
for accountants actually if you look at
the greenhouse gas protocol
it does have quite a number of
accounting principles hidden within as
well
the next area is adding credibility
accountants like auditors have been
verifying
financial and non-financial information
for the longest time too
say for example you wanted to buy some
high quality carbon offsets a quantity
of it
wouldn't you want to know that the
amount that you bought is indeed
high quality carbon offsets accountants
can play a part
in that too and last
but not least is driving change and
accountants already doing so
in the world of global governance the
international financial reporting
standards
or ifrs the trustees have come out to
say
that they will make a start in making
a combine or harmonize reporting
standards of sustainability
so you see accountants can play a part
they can drive change and on an everyday
basis
i'm also seeing accountants putting up
their hand
young accountants putting up their hand
and say i want to join this fight
i want to join this fight against
climate change and i will use my skills
and experience
to fight this so i guess
to answer that question there's some
ways
the accountants can help to fight
climate change
you know i think our world can be very
different in the future
in the future we might not hear the
roaring sounds
of internal combustion engines but
we will hear the humming sounds of
electric vehicles
in the future we won't see forest fires
red skies but we'll see clear blue skies
with air that we can breathe in the
future
our energy sources won't be reliant on
fossil fuels
those things need to be kept in the
ground where they belong
instead our energy sources will come
from the sun it will come from the wind
and it will come from gushing waters
in the future everybody will have a
right
to a good education from the start
so that they can realize their dreams
so isn't this a future worth fighting
for
isn't this a future worth fighting for
in every role that we undertake
whether or not we are an educator
whether or not we are a young person
whether or not we are mother a ceo
a chief sustainability officer a banker
whether or not we are a accountant
thank you very much
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