Only 8% of companies have plans to tackle climate change

Very few businesses have a board-level plan for tackling the financial challenges of climate change, despite the fact Covid-19 has accelerated concerns and discussions about social responsibility, research by KPMG has found

The firm questioned more than 160 business leaders, representing a range of industries from across the UK, on their environmental, social, and corporate governance (ESG) credentials.

When asked if climate change was a top priority, 82% said it was already being actively discussed, or on the boardroom agenda.

However, when asked if they had a clear view of the risks ahead and how to tackle them, only 8% of businesses reported having a fully-fledged plan in place, with 89% in early stage discussions, and 3% not at all.

Similar research globally by KPMG found 65% of CEOs are looking to businesses to fill the void in societal challenges and 76% agree that, as leaders, they are personally responsible for change on societal issues.

Sue Bonney, KPMG UK’s head of ESG, said: ‘Talk now on any post-pandemic recovery almost always includes climate change at its heart. But our survey suggests that, while many businesses are taking ESG seriously, there is a long way to go before we can truly say that everyone is placing it at the centre of their future strategic growth plans.

‘Throughout lockdown, millions of daily commutes, flights and construction works ground to a halt, visibly transforming the environment around us.

‘But, amazingly, the reduction in emissions for this year will still only be less than 10%, just showing the scale of the challenge still ahead.

‘If we’re to truly achieve the goal of transforming to a sustainable, net-zero economy, we need far greater collaboration and more immediate action at boardroom level.’

KPMG said there are growing signs that companies are starting to recognise the economic impact of climate change, 76% of business leaders surveyed viewing the measures as a ‘strategic risk issue’.

In comparison, less than a quarter (24%) regarded climate-related financial disclosure as purely a useful compliance tool or helpful disclosure.

Simon Weaver, co-head of climate risk and decarbonisation strategy at KPMG UK, said: ‘The coronavirus pandemic was, to some extent, a dress-rehearsal for climate change.

‘It’s exposed the strengths and weaknesses of businesses throughout the UK, and should be the impetus for boardroom discussions on behavioural bias to ignore big, complex problems, the importance of real-life scenario planning, and the value of proper risk planning over simply being reactive.’

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