Addressing climate change requires businesses to set net-zero emissions targets. However, a recent survey reveals that many companies struggle with budget limitations, hindering their progress towards sustainability. This financial constraint coupled with inadequate data and a changing regulatory landscape poses challenges to achieving a net-zero economy.
The State of Net-Zero Goals
According to a Hitachi Vantara survey, 82% of global businesses have established net-zero carbon goals. However, intentions don’t always translate into action. Approximately one-third of businesses cited budget constraints as a barrier, preventing the implementation of strategies to reach their net-zero targets. Insufficient data and evolving regulations further exacerbate the challenges faced by companies.
The Budget Predicament
Budget limitations have become more apparent as businesses allocated resources to address the pandemic and energy cost crises. Smaller enterprises struggle to prioritise the net-zero transition. A net-zero barometer survey by BSI revealed that half of SMEs lack a net-zero plan or policy, and only a fifth measure and report emissions reduction progress.
Regulatory Compliance and Drivers
While regulatory requirements present challenges, they also act as primary motivators for businesses pursuing net-zero goals. Compliance was cited by 66% of respondents as a driving force. Ethical obligations and cost optimisation also drive businesses towards net-zero targets. However, focusing solely on compliance may hinder progress, overlooking the long-term benefits of sustainable operations and future growth potential.
The Way Forward
To overcome barriers hindering net-zero goals, businesses must take decisive action:
- Comprehensive Strategy: Develop robust strategies aligned with net-zero ambitions, including clear implementation plans, leadership buy-in, and emissions reduction across the value chain.
- Long-Term Vision: Avoid postponing implementation plans despite distant deadlines. Recognise the urgency of the climate crisis and take immediate action to minimize carbon footprints.
- Financial Planning: Prioritise budget allocation for sustainability initiatives. Investments in energy efficiency, renewables, and process optimisation yield long-term cost savings and support the low-carbon transition.
- Data Management: Improve data collection and analysis capabilities. Robust data provides insights, identifies areas for improvement, and tracks progress towards net-zero targets.
- Collaboration and Innovation: Engage in collaboration with peers, supply chain partners, and policymakers to share knowledge, best practices, and innovative solutions. Collective efforts accelerate the transition to a sustainable economy.
The survey highlighted financial challenges in pursuing net-zero, emphasising the need for proactive action and long-term vision. By prioritising sustainability, allocating budgets, and fostering collaboration and innovation, businesses can overcome barriers and contribute to mitigating climate change. Achieving net-zero requires collective commitment, with every business playing a vital role in securing a sustainable future for generations to come.
To learn more visit our website: https://supersmart.energy/