Businesses putting off low-carbon innovation in hope of policy 'silver bullet'
European industrial firms are overlooking the importance of innovation in curbing emissions, a new study from the EU's innovation agency has found.
The Sparking an Innovation Step Change study, carried out by Climate-KIC, surveyed more than 115 executives from industrial sectors including construction, manufacturing and engineering.
It found that 63% of business leaders acknowledged climate change risks and saw opportunities in responding to these risks, but only 29% felt that innovative technologies provide an efficient method of response.
Climate-KIC’s chief executive Bertrand van Ee said: "Many businesses seem to have forgotten how to innovate, or are delaying innovation until they get a policy silver bullet. The science shows we need to reconfigure the economy in-line with the 2°C trajectory - and innovation must sit at the centre of the transition."
Worryingly 35% of respondents felt that their market would not be affected by external climate changes, so they do not need to incorporate any form of innovation.
The report focused on research & development (R&D) departments due to its importance in identifying and responding to the needs of a changing marketplace.
The report found that just 38% of R&D departments have sufficient expertise to respond to climate change. More than one in ten dedicate none of its budget to climate change.
The study also explored the effects of collaboration for enabling businesses to lower emissions. Two thirds believe that competitive markets have limited the ability to collaborate and respond to climate change.
One third of those surveyed stated that sharing resources and costs through collaboration would allow companies to reduce emissions and respond to climate change effectively.
Paul Simpson, CEO of CDP, which contributed to the Climate-KIC report, said: “Most companies, especially in the commodities space, cannot be seen to discuss or share ideas amongst themselves on carbon pricing as they could be called out for price fixing. Corporate law has been designed to prevent monopolies, but it can hold back sustainability. In my view, business needs to first collaborate to create a sustainable system – then compete.”
The worryingly lack of innovation has been somewhat boosted by Bill Gates’ announcement that he and other powerful figures are forming a new collaboration aimed at creating affordable and reliable clean energy for the entire planet.
The lack of movement from business leaders has been softened by investor pressure which has helped reduce global corporate emissions by 641 million tonnes.