Market strategies for climate change

The issue of climate change has attracted increasing business attention in the past decade. Whereas companies initially aimed primarily at influencing the policy debate, corporate strategies increasingly include economic responses. Existing classifications for climate change strategies however still reflect the political, non-market components. Using empirical information from the largest multinational companies worldwide, this article examines current market responses, focusing on the drivers (threats and opportunities) and the actions being taken by companies to address climate change. It also develops a typology of climate strategies that addresses the market dimensions, covering both the aim (strategic intent) and the degree of cooperation (form of organisation). The aim turns out to be either innovation or compensation, while the organisational arrangements to reach this objective can be oriented at the company level (internal), at companies' own supply chain (vertical) or at cooperation with other companies (competitors or companies in other sectors - horizontal). The typology can assist managers in deciding about the strategic option(s) they want to choose regarding climate change, also based on the insights offered by the paper about the current state of activities of other companies worldwide.