UK Businesses commit to tackling climate change

Business leaders in the UK have been focussing on Glasgow this week, or if they haven’t then they should have been. Scotland’s biggest city is hosting the 26^th meeting of the Conference of Parties, or COP 26 as it is more commonly known.

The global United Nations summit features world leaders, scientists and eminent guest speakers addressing the issues facing our planet, with tackling climate change the number one priority.

There are several key objectives to achieving this and include: Securing global net zero by mid-century and keeping 1.5 degrees within reach; Adapt to protect communities and natural habitats; Mobilise finance; and Work together to deliver.

The importance of achieving those goals cannot be underestimated and a lethargic and fragmented approach in attempting to achieve targets in the past means the situation is now critical and action therefore, has to be accelerated.

Publish low-carbon plans by 2023

Net zero is when a company or country achieves a balance between the amount of carbon it emits and the carbon it’s removing from the atmosphere, and from a business perspective it is this objective that is of utmost importance.

Under proposed Treasury rules most big UK companies and financial institutions will have to prove how they plan to achieve climate change targets. To be on schedule to achieve the UK’s 2050 net zero objective, those businesses will have to set out detailed public plans by 2023 stating how they will change to a low-carbon future. Business owners and shareholders will have to make the decision on how they plan to decarbonise and adapt to the necessary changes.

A panel of experts will set the standards the public plans need to abide by to ensure compliance. Green lobbyists believe this doesn’t go far enough because any commitments will not be compulsory. The government stated: "the aim is to increase transparency and accountability" and the UK was not "making firm-level net-zero commitments mandatory". A Treasury spokesperson said the market will determine whether a business‘ plans are satisfactory.

The UK is leading the way

Chancellor Rishi Sunak, speaking at the COP26 summit, suggested that the UK was ahead of other countries in becoming the "first-ever net zero aligned global financial centre".

Sunak added that the changes would mean: "Better and more consistent climate data; sovereign green bonds; mandatory sustainability disclosures; proper climate risk surveillance; and proper global reporting standards."

More than half of FTSE 100 companies have committed to eliminating their contributions to carbon emissions by 2050, representing a total market capital amounting to £1.2 trillion and annual turnover of £7.2 billion. Pledges have tripled in the last 10 months, which means that UK businesses really are trailblazing a path towards a low carbon economy.

Globally, more than 5,200 companies have signed up to the United Nations Race to Zero campaign. These are from a variety of sectors including technology, transport, retail, finance and manufacturing.

The Race to Zero is for small businesses too

The UN Race to Zero is the largest ever global alliance committed to achieving net zero carbon emissions by 2050 .This campaign acts as a catalyst for businesses going green, providing guidance as they adapt to net zero and placing businesses at the front of the global challenge to develop green technologies and attract investment.

The Race to Zero is not exclusively for large companies. More than 2,000 small businesses from throughout the UK have pledged to reduce their emissions and join the Race to Zero. This is carried out through the Together for our Planet Business Climate Leaders campaign, which helps small businesses go green and was launched by Prime Minister Boris Johnson earlier this year.

Business and Industry Minister Lee Rowley was keen to emphasise the importance of companies of all sizes committing to tackling climate change as he explains here:

“Businesses both large and small, across all sectors of the global economy, have a crucial role to play in both reducing their environmental impact and developing the green technologies that will set us on the path to net zero.

“With over 2,500 UK companies joining the Race to Zero, including the majority of our largest firms, the UK is leading the way in showing how going green doesn’t just make sense for the planet - it makes business sense too.”

Going green is positive for business

There is a concern that the economy will suffer as more companies take action to tackle climate change but that isn’t necessarily going to happen. Between 1990 and 2019, the UK’s economy grew by 78% while at the same time carbon emissions fell by 44%, the fastest reduction of all G7 nations.

Tacking climate change will enable businesses to take advantage of new opportunities, grow, attract investment, create new jobs as well as reduce operating costs, acquire new customers and save money – helping them remain competitive. And most importantly of all, it will mean a greener, healthier planet for everyone.

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