The Barriers Stopping you from Taking Climate Action and How to Overcome Them
The top three reasons that companies delay taking climate action are a lack of knowledge around sustainability, a lack of time and a lack of funds. We explore each of these three reasons and show you why they don’t have to be a barrier.
Governments worldwide have agreed that both businesses and individuals need to do more to tackle climate change and to reduce the emissions that their activities generate. Yet positive action has been slow to materialise, particularly when it comes to business emissions. So what is stopping companies from fully getting started on their journey to net zero? And what can be done to overcome these barriers?
Research conducted by the SME Climate Hub in February 2022, which surveyed 194 SMEs in the UK has cited three top reasons for delaying climate action:
lack of skills and knowledge (63%)
lack of funding (48%)
lack of time (40%)
But other research highlights that sustainability is high on the agenda of consumers across the globe. In a survey of more than 16,000 consumers globally conducted by IBM, more than half of respondents stated that environmental sustainability is more important to them today than it was 12 months ago. Half of respondents also said that they were willing to pay 59% more for socially responsible goods and services. It’s clear therefore, that sustainability is key to competitive advantage — it might just be the case that your customers are not shouting about it loudly right now. Trends indicate that it will be an issue of growing importance, which is why it’s worth taking action early and getting an edge over the competition.
Addressing a lack of skills and knowledge around sustainability
Businesses across sectors are under increasing pressure and scrutiny when it comes to taking climate action. It’s no longer enough to state your ESG values — you need to demonstrate how you’re addressing your carbon footprint and whether these actions are having a positive impact on the planet. With sustainability high on the agenda of many governments worldwide, there’s a lot of legislation to get your head around, and it can be difficult to know where to start. Here are our top tips.
1. Get your head around the three different emissions scopes
The GHG Protocol, which supplies the world’s most widely used greenhouse gas accounting standards, has outlined three different emissions scopes, which are useful for understanding who ‘owns’ these emissions at each stage, and therefore who has control over changing their levels.
2. Get to grips with emissions factors and methodologies
There are several different ways to measure your carbon footprint depending on the data that you have at your disposal. If you’re interested in finding out the factors and methodologies that are most commonly used in transportation emissions measurement, take a look at our summary. But if you don’t have the in-house capability to perform your own calculations, it’s worth researching a climate tech provider who will be able to do this for you. But be sure to conduct your due diligence and ask all the right questions before you commit.
3. Understand the basics of offsetting
The goal is to collate the data that you’ve obtained about your emissions and use it to implement reduction measures. But most businesses will have some unavoidable emissions that they are unable to reduce. Here’s where offsetting comes in. If you’re looking to understand the different types of offsetting projects on offer, take a look here.
4. Understand which climate recommendations apply to your business and what exactly you need to do to comply
Last year, European authorities announced their planned expansion of climate reporting requirements after noting that companies aren’t providing the data needed to guide capital toward a carbon-neutral future. It can be difficult to keep up with the flurry of new announcements, which is why we’ve produced these handy guides for if your business operates in the UK or the EU.
With the right resources, climate change legislation doesn’t have to be a minefield. It’s a case of establishing which regulations apply to you, and knowing how to measure and submit your disclosures.
Addressing a lack of funding
The second more frequently cited reason for businesses failing to address their carbon emissions is a lack of funding. Many senior business leaders still see an investment in sustainability as having to sacrifice financial returns in favour of saving the planet. But this view certainly doesn’t prove to be true in the long run, and we’ll show you why.
1. Understand the importance of playing the long game
A study by Harvard Business School discovered that businesses that developed processes to measure, manage, and report on ESG issues in the early 1990s outperformed a carefully matched control group over the twenty years that followed. The same study highlighted the positive correlation between high performance on particular ESG issues, and overall better financial performance. Similarly, research conducted by Bank of America Merrill Lynch revealed that companies with a better ESG record than their counterparts had higher three-year returns. They were also less likely to have price declines and to go bankrupt. The bottom line? Dedicating even limited funds to ESF now, will mean that your company is much more likely to reap the rewards down the line.
2. Know that being sustainable does not need to cost the earth
If you don’t have a huge amount of money to dedicate towards sustainable practices, make sure that you spend it wisely. Measuring your carbon footprint is a good place to start and it needn’t cost the earth. Using a tech platform means that you don’t have to hire an in-house team to produce your calculations for you, and it’s likely to be a considerably cheaper option than using a consultancy. If you’re unable to offset all your unavoidable emissions yourself, consider surfacing the measured carbon footprint to your customers and offering them the option of offsetting it. Such climate embedding is becoming increasingly common in the e-commerce and passenger travel sectors, but will soon enter a number of new sectors.
Addressing a lack of time
Lack of time arguably comes down to business priorities. Many SME leaders are under the impression that embedding sustainability into their business is a long and arduous process that requires considerable time and resource investment. This doesn’t need to be the case.
1. Empower your employees
Sustainability initiatives don’t always need to come from the top. Workers at the PG Tips tea factory in Trafford Park famously came up with the idea of reducing the end seals of tea bags by 3mm, which resulted in savings of 9.3 tons of paper per year. Meanwhile, clothing retailer Marks & Spencer nominated sustainability champions in every one of its stores (a role passed on from employee to employee), who have driven positive change throughout the company on many levels. It’s worth exploring employee sustainability initiatives at your company if you haven’t already done so.
2. Outsource the sustainability processes and tasks that you’re unable to do in-house
And if you’re looking to measure your carbon footprint to get a better understanding of how you might reduce it, consider using a climate tech provider that will take the leg-work out of the process for you, but always remember that due diligence is key.
In summary, with the right allocation of resources, a lack of time doesn’t need to prevent you from getting started on your sustainability journey.
A little climate action goes a long way
If you’re an SME wanting to embark on your sustainability journey, we hope we’ve given you some handy pointers on how to address some of the key barriers that may be standing in your way. Remember that even small actions can lead to considerable positive change. As Maria Mendulice, CEO of the We Mean Business Coalition put it, “Taken on an individual scale, each small business has a relatively moderate carbon footprint. However, together, these small businesses have a huge impact — both on the planet and on their communities.”