If you’re feeling guilty about the slow pace of your company’s journey to net zero, you’re not alone.
Only just over half of the world’s 2,000 largest businesses have set net zero targets according to Net Zero Tracker, an independent data consortium including Oxford University, which reported on net zero take up amongst businesses in November last year.
Yet the UK government is committed to reaching net zero by 2050 and expects businesses to make sure their operations are net zero-aligned to reduce emissions.
Why aren't businesses doing more about Net Zero?
The low take-up amongst businesses isn’t surprising when you look at the main reasons and challenges facing companies on their net zero transition; an overhaul of highly complex and often international operating models and supply chains.
In its February 2024 Breaking Business Barriers to Net Zero report, The Carbon Trust’s Net Zero Intelligence Unit identified three main barriers holding back companies by surveying over 400 senior sustainability decision-makers in large businesses across the UK, Germany, Netherlands, Sweden and Mexico on the biggest barriers.
Their research revealed that businesses are not so phased by addressing their own operation emissions such as switching to renewable energy but those they have no control over such as their supply chains, known as Scope 3 emissions.
Overall, the research pinpointed three critical barriers:
Barrier to Ambition:
Those in charge of sustainability are finding it hard to make the internal business case for net zero because it competes directly with growth targets and other business priorities.
They are also not in a strong enough position to engage with and influence the decision makers in the company, senior leaders or shareholders, to secure expertise, get organisational wide buy-in and ensure there is a budget to deliver a net zero transition plan, let alone begin transitioning.
Barrier to Action:
The second barrier highlighted by the research was decarbonising Scope 3 emissions. These are non-direct emissions from activities such as procurement of goods and services and use of sold products which account for over 70 per cent of most businesses’ total footprint.
The majority of businesses reported having targets to cut their Scope 1 and 2 emissions, but only one in five had a Scope 3 target in place.
The main challenge came down to the cost of investment in order decarbonise Scope 3 emissions and once again aligning emission reduction targets with business growth plans. Other key reasons cited were lack of supply chain engagement as well as the lack of a standardised method for measuring carbon emissions in the supply chain.
Barrier to Accountability:
Not surprisingly the third barrier was around there not being a standardised framework in how progress towards net zero is measured.
This leads to what the researchers called ‘greenstalling’ where businesses get stuck in a state of ‘analysis paralysis’ at the early stages of transition as they are so worried about getting facts and figures correct.
The businesses also highlighted verification and communication of their progress as the second most difficult part of their net zero plan. Crucially, they were concerned about being scrutinised and communicating the wrong information.
Taking the First Steps
If your business is serious about going net zero, take the first steps by coming up with an achievable plan. This can include a host of measures like using electric cars and vans and switching to renewable energy via solar carports which can not only save you money over the long term but help you on your journey to net zero.
