In the lead up to the election, we’ll be taking an in-depth look at different party proposals within the energy sector. Be sure to keep checking back for the latest insight.
As the UK approaches its upcoming general election, businesses across the nation are calling for robust government support to achieve the country’s ambitious net zero targets. Recent research from BSI, surveying over 1,000 senior decision makers from UK businesses of all sizes, highlights critical challenges and opportunities in this transition.
Cost concerns and financial incentives
BSI, the UK National Standards body, reports that nine out of ten UK businesses see greater government support as essential for reaching net zero by 2050. Despite recognising the financial benefits of decarbonisation, half of the surveyed businesses cited cost as a major barrier. Furthermore, 38% of businesses are not confident that net zero can be achieved without significant funding, and nearly half (47%) identified cost as the main barrier to decarbonisation.
Businesses are urging the next government to provide more financial incentives to support the transition to net zero. A significant 96% of businesses emphasised the need for greater government support, including financial incentives, to help mitigate the costs associated with decarbonisation.
There is a growing recognition of the economic advantages of sustainability. The survey indicates an increase in businesses viewing cost reduction as a key incentive for pursuing net zero, rising from two-fifths last year to nearly half this year. This trend reflects a deeper understanding of the financial benefits tied to sustainable practices.
Need for clear politics
Political uncertainty further complicates the path to net zero. About 38% of businesses indicated that their decarbonisation efforts are hampered by uncertainty over the government’s green commitments, while 35% are concerned about the actions of the next government. An overwhelming 92% of respondents want political parties to demonstrate strong commitment to net zero goals before the election.
Scott Steedman, Director-General of Standards at BSI, stresses the importance of a supportive policy environment. “We need to go further, and faster. Now is the moment for a clear policy environment that encourages organisations to invest and innovate towards net zero,” he stated.
Setting targets and measuring progress
Despite the acknowledged benefits, the path to net zero remains unclear for many businesses. Only 35% have set an overall target to achieve net zero by 2050, and just 25% have met some of their interim targets. Additionally, less than a quarter measure their Scope 1 (23%), Scope 2 (22%), and Scope 3 (18%) emissions, with larger firms more advanced in their net zero practices compared to SMEs.
Regulatory changes and legal risks are significant motivators for businesses to take action on net zero. Over half of large firms cite regulatory changes as a critical driver, compared to 36% of SMEs. Additionally, 32% of large firms list liability and legal risks as major concerns, compared to 21% of SMEs.
Supply chain challenges also impede progress toward net zero. Nearly a third (31%) of businesses face difficulties finding suppliers with net zero credentials or lack information about their suppliers’ actions. This issue is the second largest barrier after cost.
Looking forward
With the general election on the horizon, the stakes are high. Businesses are looking to the next government for leadership and support in the transition to a net zero economy. BSI’s findings reveal a pressing need for clear, consistent policies and financial incentives to drive decarbonisation efforts.
As political parties campaign for votes, they must recognise the crucial role that government support plays in enabling businesses to meet the UK’s net zero targets. By addressing these concerns and providing the necessary support, the next government can ensure that UK businesses are well-equipped to lead the way in the global shift towards a sustainable future.
