It can be extremely tempting to take a cynical view of a company’s environmental aspirations.  After all, the Friedman doctrine has dominated for so long that it can be hard to look past the view that shareholders are everything.  Of course, as yesterday’s article illustrated, there is a growing sign that companies are malleable in their environmental activities.

Further evidence of this comes from a recent report from Accenture, which reveals that around a third of European companies have pledged to be net-zero by 2050.

Environmental commitments

The study assessed data from over 1,000 companies from Europe’s main stock markets and found that there is a clear commitment to accelerate the transition towards net-zero.  These commitments appear to have a degree of weight behind them, as companies who had made them had managed to reduce their emissions by around 10% on average, compared to an increase in emissions from those who make no such pledges.

On average, European companies were hoping to achieve net-zero by 2043, with British firms showing the most progress, with UK firms twice as likely as French firms to have a net-zero target.

“The European business community is more engaged than ever in the race to zero, with the number of companies publicly setting goals having grown over the last two years,” the researchers say. “And as our study shows, the targets work. Net zero should be managed as any strategic business priority: set clear objectives to drive the entire organization to the same direction, and monitor progress to correct the trajectory as appropriate. Making targets public also helps create the required collective momentum, as companies can’t solve it alone.”

Meeting targets

There is a concern, however, that firms are not doing enough to actually meet the targets set.  Indeed, just 5% of European firms were actually on target to meet their net-zero goal.  If firms are to meet their goals, it will require them to double their pace of emissions reduction by 2030.

“Though the number of newly set targets is reassuring, it is still clear that organizations are not moving fast enough,” the researchers say. “With COP26 just a few weeks away, businesses and governments across all parts of the world need to focus their efforts on concrete action that follows robust targets to meet the challenge our world faces to reach net zero by mid-century and hold global warming to 1.5°c.”

The report goes on to provide some stepping stones to help various industries achieve their net-zero goals, with this particularly important in sectors such as manufacturing, construction, transportation, and automotive, all of which have been identified as lagging behind.

“Net-zero by 2050 — let alone sooner — will be feasible only with swift, decisive action in this decade. Our findings show that it is possible, but only if European businesses act now,” the researchers conclude. “Solutions differ by industry and company, and all have different starting points, opportunities and challenges. In some industries, the required technologies are available and will need to be scaled at speed. In others, they will have to be invented. However, getting there will require all businesses to make reinvention the norm, driven by technological innovation, collaboration, new business models and supportive regulation.”