Why new certainty on sustainability is an opportunity for business
Post-election, certainty on sustainability is an opportunity for business
By the Rt. Hon John Gummer, Lord Deben
The new government has confirmed its plans to mobilise businesses and other stakeholders to tackle climate change, deliver clean power by 2030 and hit net zero targets by 2050.
For many businesses, particularly those that have so far taken the minimum action required, the temptation will be to treat the new agenda as another set of promises that will not be delivered.
This would be a mistake.
The intent is clear. The government has already lifted the de facto ban on onshore wind. It has acted swiftly to approve a new £600m solar farm that had long been delayed. It has forced water companies to sign an agreement that holds them accountable for their performance.
Yes, delivery is always the challenge with policy, and it remains to be seen whether the government will achieve its goals or not.
Even so, these are signs that this is a government with purpose. One which will determinedly view, regulate and support the activities of businesses through the lens of climate change and sustainability.
Adding further focus, the new government has inherited a High Court ruling that requires it to present, within one year, a clear plan by which it will achieve net zero emissions by 2050.
This level of certainty is crucial for long-term planning and investment in sustainable practices.
The appointment of Chris Stark to lead the new Mission Control is another strong signal of the government’s intent. Stark’s mandate to transition the UK to clean power by 2030 underscores a commitment not just to policy-making but actual implementation.
Within this new environment, businesses can act with purpose and more confidence that their sustainability plans will align with and be supported by policy that will be delivered.
Distinct change of direction
Those businesses that still lag behind the agenda, unsure of whether it will have any meaningful impact on them, will find that uncertainty is their greatest enemy and will inevitably fall even further behind.
Under the previous UK administration, we saw uncertainty on sustainability that influenced many businesses. We may see UK plc losing ground in the rapidly-growing global markets for sustainable alternatives as a consequence.
This approach flew in the face of business sense. The way we view climate change and the related challenges to nature and biodiversity should be anything but uncertain. We know that climate change is happening. We understand that the impact is more severe every year. We therefore have the opportunity to recognise that need for certainty, plan for it and transform it into an opportunity for growth and innovation.
With the new government in power, there is good and reasonable hope that businesses will have a new platform to grasp this opportunity with more purpose and vigour.
Make no mistake, the government’s commitment to addressing climate change provides a more stable and predictable framework within which to operate. This is a significant shift from the previous administration and, potentially, very good news for businesses prepared to respond positively.
How we should respond
To understand how to turn the certainty of climate change into a business opportunity, we can look to China. Of course, China is still increasing its use of coal, but this is an ever decreasing proportion of its energy production as it builds onshore and offshore wind and solar capacity at rapid pace.
Despite criticisms, particularly from the United States, China has also effectively capitalised on the global shift towards sustainability and established itself as the market leader in key areas.
Testament to this strategic foresight, China’s dominance in the photovoltaic market is a recognition of the inevitability of climate change. Similarly, it has made substantial strides in the electric vehicle sector, anticipating the unavoidable shift away from fossil fuels.
What this also tells us is that the case for sustainability is not just moral; it is economic. By thinking through problems related to climate change, businesses can profit.
With the renewed government concentration on sustainability, UK businesses must now adapt and align with this approach. Knowing that climate change is a certainty, and that the government is determined to act on it, we must turn the problems we face into opportunity.
We must invest in research and development to create sustainable technologies, and also, solutions that will help us live on a planet that we know is warming and will require us to live and operate differently.
We must also think of what the consumer wants. Consumer demand for sustainable products and services is on the rise. Businesses that fail to meet these expectations risk losing market share. We must adapt or face the consequences.
We must recognise too that acting on sustainability now is crucial. Thinking in line with and even ahead of government is far more cost-effective than being forced to adapt later.
The approach China has taken serves as a powerful example for businesses and governments worldwide. By acknowledging the certainty of climate change, supported by government direction and policy, we can identify and exploit new opportunities. And by doing so, we can create the wealth and profit we need to manage the transition and create a cleaner and greener system that is fairer for all.