hidden in the company that does not show up in the standard financial statements. For example,if your firm’s tangible value is only 50% of the market value, but you report the intangible value the firm really has as twice the tangible value reported (or 100%), your stock price will probablygo up, as investors will realize that they have undervalued your firm’s value because they are notaware of the real total market value of your company. DP # 32: Article 52- 5 Reasons 500 Companies Have Made Commitments to Climate ActionHow can emission reductions affect companies such as Walmart and General Motors ? On average how much money can they save on an annual basis?JC Response: I don’t have the current numbers, but General Motors has reported that the installation of 186,000 LED bulbs and fixtures is one of many steps helping General Motors save$73 million in energy costs in 2016. Global efforts to increase energy efficiency play a significant part in GM’s goal of meeting the electricity needs of its worldwide operations with 100 percent renewable energy by 2050 and reduce their carbon footprint. LED light installations typically have a breakeven return of 6-18 months, and they are guaranteed to last 20-25 years. An annual savings of $76m on an original investment of, say, $100m, is a very good return (76% per year), and a lot better than putting that investment amount into a savings account, and a lot better than General Motors annual return to investors (less than 10%). For WalMart, I did see a number saying emissions were over 21 million tons of Co2 emissions in 2013, but those were only the amount of energy used in their offices and stores, and not in transportation, supply chain or other sources of CO2 emissions. Reducing those emissions by half would reduce their CO2 costs (calculated at the $10/ton CO2 value used by Shell Oil company) would be $105m in cost savings. Assuming that the buildings are only 25% of WalMart’s CO2 emissions, total Co2 savings could be over half a billion dollars! DP # 33: Article 52- 5 Reasons 500 Companies Have Made Commitments to Climate Action 2. Sometime in the near future there will be billions upon more billions of people that will share our planet. There will be an increase for demands for food, water, and renewable energy and infrastructure are pushing nature to its limits. And the impacts of climate change making it’s presence appear globally. JC Response: Don’t panic yet. While the earth’s population (estimated at over 7 billion in 2017) is still growing, the rate of growth is slowing down significantly. Many European countries and China have negative fertility rates (i.e., number of babies born are not replacing the deaths of elderly citizens.) Traditionally, as countries get more wealthy, their birth rates go down dramatically, from 7-10 children per couple to less than 1.75 per couple, so the rate of population growth will drop. Estimates vary widely, from topping out at anywhere from 8 to 12 billion people in 2050. Of course wars, diseases, natural disasters, or climate change could change these estimates dramatically. The key s to have the developed world retrofit their
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- Summer '19
- Business, Interest