The last few years have not been without uncertainty. And this will only continue as we move forward. Skyrocketing inflation, the war in Ukraine, and the resulting energy crisis are having a catastrophic impact on people around the globe as they seek to do more with less. For business leaders, difficult choices must be made.
One constant amid this uncertainty is the need to continue pushing forward with climate goals. As global supply chains shift, leaders may look to achieve greater stability in the form of reverting back to carbon-based energy tactics. This is mainly due to the need to address affordability and security of supply as the political and economic instability escalates.
Reaching climate goals is now a business imperative
In the UK, realities of the climate crisis are becoming more and more apparent to citizens and business leaders alike. In addition to rising energy bills, the latest Climate Change Risk Assessment report details some worrying potential risks to human life. For instance, unless further action is taken, annual damages from flooding caused by global warming will increase by at least 40% by 2080. Such damages not only have a financial impact on households and businesses, but could result in health risks and possibly even danger to life. The direct incentive for businesses to implement sustainability strategies is clearer now than ever before.
Remaining committed to climate goals is now a business imperative. Many organisations have set climate goals already – pledging to make the decarbonisation journey a reality and working hard to meet their objectives. Sustaining the momentum will be key, as any temporary move back towards coal, oil and gas could possibly increase the carbon emitted in the short term. Businesses must start shifting their mindsets to meeting long-term climate goals, and prioritising strategic, forward-looking thinking in place of short-term gains.
What risks do we face if we procrastinate?
With governments and business leaders facing increasing financial pressures, one might ask – why the urgency to stay committed to climate goals? The answer is simple – time is running out. Even a temporary delay, especially paired with other organisations’ actions, risks rolling back the clock and undoing previous progress made towards climate objectives. Pushing back goals, or adjusting timelines could do more than simply postpone achievement, it makes the end-goal further challenging to reach. Over time, this could be catastrophic.
As public opinion shifts and stakeholder expectations change, demonstrating a robust plan to achieve net zero goals is imperative. Reputational damage is another key factor for leaders to consider, with financial regulators and investors now looking for organisations to comply with mandatory requirements. Additionally, investors expect both current and future investments to be transparent about their strategies to manage impending climate scenarios. As a result, not having a solid plan in place to make the transition happen is no longer acceptable.
Looking forward: Making the shift to long-term thinking
Companies that haven’t yet embarked on their transition journey should start now. Although it can be difficult to set aside some of the urgent financial needs at the moment, building and implementing a net zero strategy takes time, and temporary shifts in the geopolitical climate don’t need to make the journey even longer.
A promising step on the decarbonisation journey would be using this time to look into building a sustainable energy portfolio. In this sense, renewables are the future. This is great in the short term, as investing in renewable energy opens the door to being more self-sufficient – fulfilling energy needs without reverting back to the damaging use of carbon-based tactics. In the long term, adoption of renewables demonstrates a commitment to a greener future.
If organisations opt to set aside their climate objectives, consumers and stakeholders may choose to work instead with greener competitors, potentially leaving companies without a transformation plan in place behind – even appearing potentially unattractive or irrelevant in comparison.
Don’t get distracted
To put it bluntly, we cannot afford to be put climate objectives on pause – procrastination helps no one, and in this case may even prove harmful by winding back the clock on progress made thus far. Leaders have to keep their feet on the gas, always working to ensure that they are actively reaching for net zero goals – even in the face of extreme uncertainty and political instability.
In uncertain times, it is understandably human nature to seek comfort in familiarity. Regardless, the dire climate situation that we are in now proves that we cannot allow short term pressures to distract from the overall goal. Looking forward, it will be critical to not only consider immediate gains, but think about how our actions may impact the lives of those for generations to come.
About the Author
Freddie Hospedales is the Chief Marketing Officer at ENGIE Impact. He’s responsible for creating and strengthening market awareness of their brand globally, generating a pipeline of new clients and introducing existing clients to new services.