Introduction
For many businesses, net zero targets can feel like yet another item on an already long to-do list, and with competing priorities and rising operational costs, it can be tempting to delay action or push targets further into the future.
In fact, one recent survey found that 24% of businesses had extended deadlines, paused, or re-evaluated their net zero targets over the past year.
But delaying action does not make the problem go away, in fact, it could mean climate change has an even bigger impact on your business. Although net zero targets may seem a long way off, the sooner your business starts taking action, the better positioned you will be to handle future challenges.
In this blog, we explore the reasons why delaying your net zero action could harm your business, and what you can do to set realistic targets and stay on track with a carbon reduction strategy.
Why Delaying Net Zero Action Could Harm Your Business
There are many factors that can influence a business’s decision to delay net zero action, and for many, cost savings are a key consideration. However, stepping back from net zero commitments could have the opposite effect, creating greater costs and operational challenges further down the line.
Financial factors
Despite the common misconception that net zero is expensive and offers little return on investment, choosing to scrap or delay your net zero plans can actually expose your business to higher regulatory costs. As new environmental regulations come into force, businesses that do not already have net zero strategies in place may end up scrambling to meet new requirements, often requiring costly, rushed changes.
A recent economic report suggests that rushing carbon reduction strategies, including a faster move away from fossil fuel sources, can cause more economic disruption because many major changes happen at the same time. The fallout can mean that energy may become more expensive, fossil-fuel companies may struggle to repay their debts, interest rates may rise and investments can lose value.
Your sustainability initiatives can also have a direct impact on how your business is perceived by investors and buyers, with a report from PWC finding that a large majority (79%) of investors say the way a company manages ESG risks and opportunities is an important factor in their investment decision making. The same report also found that 49% of investors are willing to divest from companies that aren’t taking sufficient action on ESG issues.
For public sector businesses, there is also growing pressure to demonstrate sustainability progress in order to qualify for and successfully procure contracts. For example, the UK Government’s Procurement Policy Note (PPN) 006 sets out requirements for certain suppliers bidding for major government contracts to provide a Carbon Reduction Plan, demonstrating their commitment to achieving net zero emissions by 2050 and reporting relevant emissions. If your business cannot meet these requirements, you risk being excluded from procurement processes and missing out on valuable tender opportunities.
In addition to pushing costs higher, businesses that fail to implement net zero strategies also run the risk of missing out on savings. There are lots of ways that sustainability strategies can save your business money, from cutting energy costs and minimising waste to boosting sales through improved brand image.
Operational factors
Delaying net zero action can also create significant operational challenges. Taking a gradual and structured approach gives businesses time to identify potential obstacles, test solutions and address any bumps in the road as you encounter them. Leaving action until the last minute can mean making large-scale changes in a short space of time, increasing the risk of disruption, unexpected costs and mistakes.
This can slow progress towards net zero and make your goals more difficult and expensive to achieve. The effects of climate change and climate-related risks are already affecting businesses, and waiting to act does not mean these risks will wait with you. Extreme weather events, including flooding, heatwaves, storms and droughts, can disrupt operations, damage sites and equipment, affect staff safety and travel, and interrupt the supply of essential materials and services.
These disruptions can lead to delays, increased operating costs, lost productivity and unexpected repairs or replacement expenses. This can make achieving your climate goals more challenging, time-consuming and costly.
There is also a risk of falling behind competitors that are already investing in more efficient technologies, processes and products whilst your business remains reliant on outdated or inefficient technology. Changing customer expectations may also put pressure on businesses to offer lower-carbon products and services. As demand for more sustainable options grows, businesses that fail to adapt could find themselves losing customers and market share.
How to Set Net Zero and Sustainability Targets for Your Business
When it comes to setting a net zero target, simply saying you want your business to ‘be net zero’ is too vague and can make monitoring your progress more difficult.
You should start by calculating your baseline. This includes your current emissions (scope 1, 2 and 3), environmental footprint, energy use and waste produced. This gives you a clear picture of where your business is starting from and helps identify the areas with the greatest potential for improvement. To calculate your baseline, gather data such as energy and fuel consumption, business travel, waste volumes and purchased goods and services, then use recognised emissions factors to convert this activity data into carbon emissions. Establishing an accurate baseline provides a reliable benchmark against which you can set realistic targets and track your progress over time.
Business energy audits are also an effective way to understand exactly how much energy your business is using and when. Your auditor will assess your site in full, as well as analysing energy consumption and meter readings and examining your equipment and building fabric to build a clear picture of your energy use. This information can then be used to inform recommendations for energy efficiency and carbon reduction.
When deciding on your targets, you should aim to create specific, measurable and time-bound goals, rather than simply stating that you want to reduce emissions. Science-based targets can help your business set emissions reduction goals that meet the level of decarbonisation required to limit global warming. This provides a clear framework for understanding how much you need to reduce your emissions by and when. Targets should also be supported by clear measures and performance indicators, allowing you to regularly monitor progress and identify where further action may be needed.
Although your long-term goal of reaching net zero may seem ambitious, breaking it down into smaller, achievable steps can make the journey much more manageable. Develop a net zero roadmap that sets out the steps you will need to take to reach your targets, with both short-term milestones and longer-term goals, as well as factoring in budgets and required resources. This could include improving energy efficiency, switching to renewable energy, reducing waste or reviewing your supply chain. Setting interim targets gives you clear points at which to measure progress so you can review and update your strategy to get the best results.
Setting effective net zero and sustainability targets can feel complicated, particularly when it comes to understanding your emissions and identifying the right reduction measures. A trusted sustainability partner can provide the expertise and support you need to establish an accurate baseline, identify opportunities for improvement, develop your targets, and create a practical plan for achieving them.
How to Create a Carbon Reduction Strategy for Your Business
A well-defined carbon reduction strategy is essential for ensuring you get the maximum impact from your sustainability initiatives. It provides a clear framework for reducing emissions, tracking progress, and identifying opportunities to develop strategies so your business can continue to respond to changes and challenges.
When developing your carbon reduction strategy, there are several key steps to consider, ensuring your approach covers all areas of your business and complements your business goals:
- Identify your biggest sources of emissions – Your largest emissions may come from your value chain (scope 3), the energy you purchase (scope 2), or fuels used directly in your operations (scope 1). Analyse your carbon footprint to identify the key hotspots and focus your reduction efforts where they can have the greatest impact.
- Focus on reducing emissions – Simple energy efficiency upgrades can go a long way for reducing your carbon emissions without interrupting your operations or compromising the level of service you provide for customers. Introducing renewable energy, whether through on-site generation or green energy plans can also have a huge impact on reducing scope 2 emissions.
- Consider your supply chain – Scope 3 emissions can make up as much as 70-90% of a business’ carbon emissions, so neglecting to include scope 3 in your carbon reduction strategy means you may be missing out on valuable opportunities for decarbonisation. This involves working with your suppliers to reduce emissions and improve sustainability across your wider business.
- Assign responsibility – By making specific people or teams responsible for areas of your carbon reduction strategy, you can create accountability and increase the likelihood of meeting your sustainability goals.
- Engage employees and customers – You should communicate your plans and goals clearly to your team and encourage others to support your progress. Showing customers your sustainability efforts can also help showcase your environmental responsibility and boost your brand image.
- Consider carbon removals and offsetting as a last resort – Although you should prioritise reducing emissions first, where complete emissions elimination cannot be achieved, use carbon offsetting methods such as carbon credits and invest in carbon offsetting projects like reforestation and carbon capture technology.
Protect Your Business with Net Zero and Sustainability Solutions from Consultus
At Consultus Sustainability, we support businesses of all sizes and across all sectors to develop practical carbon reduction strategies tailored to their unique needs. Our approach helps you take action towards net zero whilst future-proofing your business.
- Net Zero Pathway (NZP) – Reaching net zero is a journey, not something that can be achieved overnight. Our Net Zero Pathway (NZP) is a bespoke service designed to support your business at every stage of that journey.Available at a range of levels, the NZP can be tailored to suit your specific requirements and goals. From an essential ‘Snapshot’ that provides a clear starting point and foundation for your net zero journey, through to our more comprehensive ‘Pledge’ package, which provides ongoing, long-term support.Whatever stage you’re at, our Net Zero Pathway provides a clear, practical roadmap to help you understand where you are now, identify where you need to go, and take the right steps to achieve your carbon reduction and net zero goals.
- Scope 3 – Tackling Scope 3 emissions is an essential part of any effective carbon reduction strategy. Our team can help you identify, understand and reduce emissions across your wider value chain.We’ll gather and analyse data across the 15 Scope 3 categories, covering areas such as your supply chain and upstream and downstream activities to create a clearer picture of where your emissions come from and their environmental impact. We will then identify key areas for improvement and provide practical recommendations to help you reduce them.
- Sustainability reporting – Whether your business is subject to mandatory emissions reporting requirements or you simply want to stay ahead of evolving regulations, the Consultus Sustainability team can support you with ESOS, SECR, and other reporting and compliance needs.We can help you collect, analyse and report high-quality emissions and energy data, giving you greater confidence in your reporting and a clearer understanding of your environmental performance.This data can also provide a valuable foundation for your wider carbon reduction strategy.
Our renewable engineering division, Ennovus Solutions also offers a number of services that can help you prioritise your net zero goals. From energy audits to comprehensive decarbonisation strategies, the Ennovus team can provide the technical expertise and practical solutions you need to identify opportunities, reduce energy consumption and emissions, and move towards a more sustainable future.
If you want to prepare your business for the future of net zero, get in touch with our team today to explore your options!
