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Blog Post 27 October 2021

Race to Zero: the role of businesses in the transition to net zero

On Wednesday 20 October, 115 attendees joined the Race to Zero Europe – Countdown to COP26 virtual event, hearing from some of the leading business players across Europe about the benefits of taking immediate action to halve global emissions by 2030 and deliver a healthier, fairer world.

The UN-backed Race to Zero mobilises a coalition of leading net zero initiatives across 4,475 businesses from over 110 countries, with businesses in the race now accounting for almost 15% of the global economy. All members are committed to the same goal: reducing emissions across all scopes quickly and fairly, in line with the Paris Agreement to limit global temperature increases to 1.5°C.

Ahead of the event, we sat down with Neil Sachdev, chair of Energy Saving Trust and speaker at the event, to find out more about the challenges facing businesses in the transition to net zero, and why organisations should join the Race to Zero.

What are the main challenges facing businesses in the transition to net zero?

It’s consistency of policy, being confident in the belief that policy will remain in place for a while, at the same time as ensuring the policy is easily understandable. This is especially important for SMEs. Some businesses have found policies very difficult to comprehend, especially when it comes to understanding where the biggest benefits are. So many changes are both commercially and environmentally sound. By simplifying these, we will get a bigger take up, and faster.

Another big challenge, particularly for smaller business, is that they haven’t fully understood where they get their bang for their buck in this transition. They don’t have the internal skills that large companies have to navigate their way around the opportunities. It’s sometimes difficult for them to work out where the best place to spend their money is in order to deliver the best outcomes – both in terms of carbon reduction and in terms of economic benefit. There are so many changes that we can make that deliver immediate benefit, and this is somewhere the supply chain can help.

This is without a doubt about the emergency we face about climate change and the carbon emissions we’re creating. But it’s also an imperative in terms of commercial resilience. If we don’t deal with the climate emergency, the commercial organisations that exist the way they do now, will become weaker. This is because the costs of operating these businesses will go up, and their ability to operate in certain regions will become less possible. So, it’s about how we can become more consistent in communicating these messages, while improving access to solutions. 

The Race to Zero is calling on businesses to take immediate action to halve global emission by 2030. Why should organisations join this race?

For every organisation to retain its supply chain, it needs to contribute towards reducing its impact on the climate. This is a commercial issue for businesses, as well as a climate change issue – the two are intrinsically linked. You cannot have a business that is resilient without ensuring it delivers a reduction in carbon emissions. We will see the costs of operating businesses rise, not just because we’re going to see the cost of energy rise, but also because we will see the price of obtaining products and raw materials rise. This in turn will make it harder and more expensive to operate for businesses.

We should also mention the issue of where we operate businesses. There will be parts of the country, parts of the world that will become uninhabitable and impossible to continue trading from – whether you’re growing vegetables or crops, or you’re producing steel. If we don’t act now, we’ll have less land to work from. That’s why every organisation in the world – big, small or sole provider – has got to put its weight behind this and try to do something about it. Joining the Race to Zero is a good place to start.

Why is collaboration between global businesses so important in addressing the climate emergency?

Collaboration is good in anything! One of the biggest opportunities here is the speed of change. If we all collaborate with our own experiments, trials, installations, and changes that we make, and we share them around quicker, we will get to the end faster as a world, rather than as individual companies or nations. There is no silver bullet to resolve this; we will need many small steps as well those big step change ideas to enable and deliver sustained and sustainable solutions. That’s where the biggest power in all this is. It’s the drive to create common learning and speed to market.

Last updated: 22 October 2021