Nine in 10 UK businesses want greater government support for decarbonisation

The industry has laid out five major policy demands for the Government to ensure the nation achieves its net-zero by 2050 goal.

This is according to the British Standards Institution (BSI)’s fourth annual ‘Net Zero Barometer’, which surveyed more than 1,000 senior decision makers from UK businesses of all sizes and across sectors.

The survey found that 83% of firms are committed to achieving the UK’s legally binding net-zero emissions target. However, barriers persist, with 92% acknowledging challenges and one in five organisations unable to commit to achieving net-zero by 2050.

With the general election set for this year, 96% of businesses surveyed are urging the next government to provide more support, including financial incentives, to assist with the net-zero transition, with 47% of firms citing cost as a major obstacle.

BSI’s standards director- general Scott Steedman said: “I am pleased to see from this research that many businesses are starting to turn net-zero ambition into action. However, we need to go further, and faster.

“From government, now is the moment for a clear policy environment that encourages organisations to invest and innovate towards net-zero.”

According to the survey findings, political uncertainty is presenting a considerable challenge for businesses, with 38% reporting that their decarbonisation efforts are hampered by doubts about the Government’s green commitments, and 35% concerned about the policies of the next government.

This comes after Energy Security Secretary Claire Coutinho stated that policy certainty is not what businesses “need the most” from the UK Government, arguing that “living with uncertainty” is better for businesses as it stimulates market competition.

As per the survey, 92% of respondents now want pre-election commitments from political parties to ensure the UK meets its net-zero goals through targeted policy measures.

Declining optimism for net-zero among UK businesses

The survey highlights that 23% of businesses lack confidence in reaching net-zero by 2050, and 28% plan to take no action in the next 12 months.

Additionally, 38% believe significant costs are inevitable for achieving net-zero, while 51% indicated that the cost-of-living and energy crisis has impacted their ability to take action in the past year.

The barometer also revealed that only 35% of businesses have set an overall target to achieve net-zero by 2050, and just 25% have met some interim targets.

Furthermore, only 15% have published annual reports including carbon emissions data, and a mere 18% have dedicated teams for implementing net-zero policies. Measurement of emissions remains limited, with less than a quarter tracking Scope 1 emissions (23%), Scope 2 (22%), and Scope 3 (18%).

Nearly 23% of businesses identify a lack of clarity on net-zero definitions and guidance as a significant barrier, while 19% are hindered by internal skills and knowledge gaps, and only 15% understand the offsetting market.

Additionally, supply chain challenges affect nearly a third (31%) of businesses, with difficulties in finding net zero-compliant suppliers being the second largest barrier after cost, according to the survey findings.

Drivers for net-zero progress amidst rising challenges

Despite these challenges, the survey underscores an increasing awareness of the economic value of accelerating net-zero progress. For 48% of businesses, reducing costs is the key incentive for decarbonisation, up from two-fifths last year.

Additionally, nearly a quarter of businesses see increased preparedness for new government policies as a major benefit. Other key drivers for net-zero action include climate-related risks (23%), regulatory changes (20%), reputational risks (10%), and client/customer pressure (15%).

According to the survey, businesses are taking some accessible measures, such as energy reduction (54%), switching to LED lightbulbs (50%), and waste reduction or using recycled materials/feedstock (49%).

Nevertheless, BSI highlights that more comprehensive actions are needed to overcome the significant barriers identified in the survey.

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