Going net zero isn’t just about being seen to do the right thing. It can have massive benefits for your company, as more and more businesses across the UK are finding out.
The term net zero is often banded around together with carbon neutral though there is an important distinction between the two.
Carbon neutral means a company offsets the carbon or green house emissions it uses by buying carbon credits or planting trees and doesn’t reduce the carbon is uses.
Net zero means you actively get rid of your greenhouse emissions through stopping or changing the way you go about your business in more efficient and climate-friendly ways. This means you’re not producing any more greenhouse gas emissions than you are taking out.
So, for example, moving to renewable energy like solar carports which can be used to refuel electric cars for your workforce.
Is There a Net Zero Legal Requirement For Businesses?
Yes, in 2019 the UK government set out its commitment to reduce carbon emissions by establishing a net zero target for all companies, no matter how big or small, to reach by 2050 with milestones now set in law.
The government also set interim targets in 2021, including reducing emissions by 78 per cent by 2035 and to 90 to 95 per cent of their emissions before 2050. The remaining 5 to 10 per cent must be reduced through carbon offsetting projects.
In addition, if companies want to be considered for a UK government contract over £5 million a year, the minimum requirement is for businesses to a commit to net zero.
So, what are the benefits of going net zero for your business?
Cut Operating Costs and Build a More Sustainable Supply Chain
You may think that climate change is affecting other countries more than the UK but there is much evidence to show extreme weather events like storms which disrupt supply chains are on the increase.
Harnessing the power of renewable energy will reduce running costs over the long term and provide more stable energy security and a stronger and more sustainable supply chain in an increasingly unstable global energy market.
Gain a Competitive Edge in Attracting New Customers and Investors
Net zero businesses are very attractive to customers and investors who are keen to use and invest in companies who are not harming the environment.
A 2023 study by Deloitte showed a third (34 per cent) of consumers stated their trust in brands would be improved if they were recognised as an ethical/sustainable provider by an independent third party. A similar number (32 per cent) claimed their trust in brands would be improved if they had a transparent, accountable, and socially and environmentally responsible supply chain.
Great marketing opportunities
Keep a record of your journey to net zero and shout about it. If it has been difficult, tell your customers, stakeholders and the media all about highs and lows. Customers like to hear how much effort a company has gone to tackle climate change.
But make sure your employees understand why your company is on this journey and what needs to be done. This means including your marketing and comms people right from the start, so they can capture all the challenges and lessons learned.
In this way, they will be able to inform employees and write case studies, press releases and create video content to communicate your unique story, helping people to see your business as a leader in championing net zero.
However, a word of warning. You need to continue to tell customers and stakeholders how you are doing at least once a year. Transparency is key according to the Carbon Trust which sets out how to communicate net zero targets.
Customers need easy to read facts and figures on your website and think about how to communicate your green credentials in annual reports, signage, labelling or social media.
Enhance your reputation
As the Deliotte studies revealed, having your net zero credentials validated by a third party can help enhance your reputation amongst customers and investors. For example, Planet Mark helps businesses certify and measure their progress towards their sustainability goals.
There are a number of business awards your company could enter such as Business in the Community’s British Business Excellence Awards in England and Wales and Responsible Business Awards in Northern Ireland.
If you reduce your emissions through the SME Climate Hub, you will be counted in the UN Climate Change High Level Champion’s Race to Zero campaign. This means you can have your business name and logo featured on the hub and be recognised by the United Nations Race to Zero campaign.
Your business could also become certified to an environmental management standard (known as EMS) such as ISO 14001 which provides a framework for organisations to continually improve their environmental performance.
Taking decision to go net zero is not just a moral and legal imperative but a strategic business decision that can yield significant benefits. By cutting operating costs, enhancing your reputation, and gaining a competitive edge, your company can position itself as a leader in sustainability. And you can bring your clients and stakeholders along with you by telling your story as you progress, one step at a time.
