British business commits to green future

BRITISH businesses are committed to do what it takes to tackle climate change but the UK effort will only succeed if it becomes an urgent, shared national priority for companies, consumers and the government, a groundbreaking new report said today.

For the first time, senior representatives from every major sector of British business have come together to assess the challenges posed by climate change and to identify the actions necessary to tackle them. The CBI Climate Change Task Force report is the culmination of 10 months' intensive work by 18 chairmen and chief executives from some of the UK's biggest companies, under the independent chairmanship of BT chief executive Ben Verwaayen.

Analysis developed specifically for the report by consultants McKinsey shows the UK's carbon reduction targets for 2020 are likely to be missed but that 2050 goals, whilst stretching, can be achieved at a manageable cost – provided a greater sense of urgency is now adopted.

It identifies priority areas for action that would put the UK back on track to meet its targets by 2030. Today's report explains how business will play its part, and commits the CBI to continue to play a leading role, both nationally and internationally.

The report, published on the first day of the CBI's annual conference in London, says that firms will have fundamentally to change their business models to meet consumers' and society's needs in an era of climate change.

The Task Force says the longer we wait the higher the cost will be – but that if we act early, the cost for each household can be limited to around £100 a year by 2030.

It stresses that alongside the risks, the shift to a low carbon economy offers the UK a unique opportunity to develop innovative environmental technologies of the future and prosper in new, multi-billion-dollar world markets – but only if research funding is better co-ordinated and prioritised.

The report coincides with research by Barclays Commercial Bank which has found that owner-managers of companies in Yorkshire are confident of their ability to manage pressures to 'go green'.

Just 10 per cent say the need to demonstrate that they are environmentally responsible represents a threat to their organisation, with 34 per cent seeing the growing green agenda as a pure opportunity for their business.

The research suggests the link between sustainability and commercial success is becoming clearer to businesses in Yorkshire – being seen to act more responsibly when it comes to the environment can help win new deals, create high value products and services and build enthusiasm amongst employees.

Lee Collinson, corporate director of Barclays Commercial Bank in Yorkshire said: “Developing more sustainable business practices and reducing environmental impact should be a priority for all businesses. The bottom line benefits of operating more responsibly are becoming clearer by the day. What is less clear is how businesses make their green aspirations a priority and a reality. The CBI's Climate Change Taskforce findings will assist this process by sparking welcome debate and providing much needed guidance to UK businesses so that we continue to thrive and meet whatever challenges of sustainability lie ahead.”

The research shows that businesses in Yorkshire see it as more of a threat than their regional counterparts (10 per cent compared to the lowest 9 per cent in Scotland).

However, it also revealed that businesses are only just beginning to understand the operational and cost implications of reducing their impact on the environment. Almost half (49 per cent) admit that they are concerned by the potential for increased compliance, but encouragingly 54 per cent do not feel they will need to invest in new business assets to keep pace with new environmental regulations.

Companies in Yorkshire are also aware of the potential reputational damage that may accompany being labelled a 'green offender' (24 per cent).

Within the report, 'Climate Change: Everyone's Business', Task Force member companies make a series of pledges to adapt their businesses for the new low carbon world. These include:

A promise to develop new products and services that will encourate households to halve their emissions by 2020 and a commitment to work in partnership with the two million employees of the Task Force members to achieve major cuts in their emissions both at work and at home to save an extra one million tonnes of CO2 emissions within three years.

Ben Verwaayen, Task Force chairman, said: “Today the CBI Task Force has demonstrated its commitment to tackling climate change. This is a call to action to the wider business community whose support we need, an offer of partnership with government, and a commitment to empower consumers. They are key to any solution because of their power to demand environmentally friendly goods, and their influence on government as voters.

“We need to support the consumer with better information and more choice. We have to involve our employees and we must report transparently our own carbon footprints. This is not just a challenge, it is also the chance to become leaders in a new low carbon economy. In business, in government, as consumers and citizens we are all part of the solution.”

Richard Lambert, CBI director-general, said: “This report makes clear that in the future, businesses will have to be green to grow. To manage their costs and to maintain the trust of their customers, they will need to build carbon management into their corporate DNA.

“To get to a secure future, both environmentally and economically, we also need the Government to build on the leadership role it has already carved out on climate change. Critical decisions need to be taken now if we are to have a chance of hitting our emissions targets, let alone achieving tougher ones.

“It must see through legislation that allows low carbon power plants – of all types – to get through our planning and regulatory systems, and it must keep the pressure on our international partners to commit to agreements that deliver a robust world price for carbon.

Commenting on the report, Sir Nicholas Stern, author of the authoritative report for the UK government on the economics of climate change, said: “Business has shown real leadership in publishing this report. It provides a rigorous and realistic analysis of the issues and identifies the key policies, emphasising the importance of clear price signals over the short, medium and long terms.

“It rightly emphasises the importance of collaboration between government, business and households, and demonstrates clearly the importance of timely action. At the same time it shows that effective action can be taken at acceptable cost.”