As specialists in sustainable investment, RA-ESG often asks whether international organisations and big business could be doing more to reduce their environmental impact and to influence their customers and the communities around them. The answer is that big businesses seem to be collectively moving in the right direction and adopting a more proactive mindset.
50 percent of big business committed to net zero
The Net Zero Tracker.net figures from November 2023 confirmed 50 percent of the world’s publicly listed companies from the Forbes Global 2000 list are now committed to a net zero target. In the UK, despite the Government’s backtracking on the implementation date of the country’s net zero targets, 94 percent of the UK based companies listed in Forbes 2000 has set net zero targets.
Chairman of the UK Net Zero Review, The Rt Hon Chris Skidmore MP explained: “The bulk of the UK’s largest businesses are committed to net zero – and are planning and investing to capture the opportunities of the transition. Having signed net zero into law four years ago, it’s remarkable that such progress has been made.”
Similar proactive stances were taking place across the Atlantic in the previous year (2022), when four hundred and eight of North America’s largest brands and institutional investors sent an open letter to the US President, Joe Biden. Signatories included global big hitters such as Apple, Amazon and Ford, who came together to demand a more action and for goals to be set for a substantial reduction in carbon emissions by 2030. As reported on INC.com, the letter was sent to ramp up the pressure on Biden in the run up to the Earth Day summit and to “restore the US standing as a global leader … and to address the climate crisis at a pace and scale it demands”.
A healthy bottom line and planet
There is a cost attached to any type of change in industries, but there are also long term financial, social and environmental gains to be made. To directly fight climate change, private companies must tread a delicate line between helping to save the planet, communities and the health of consumers and employees, whilst achieving a healthy bottom line. There is no getting around it, a proactive approach to reducing carbon emissions may in the short term impact the bottom line but it will ultimately have a positive impact on consumers and will allow the company to keep pace in an increasingly green focused landscape.
Cost efficient solar power
As technology improves and sustainable investments increase, the cost of clean energy is reduced, allowing for cheaper more environmentally friendly energy supplies. Irena.org asserted that over the last 13 to 15 years, the cost of solar energy and wind energy generation have fallen dramatically. By 2022, they were cost-competitive with fossil fuels: the global cost PV solar power fell by 89 percent to USD 0.049/kWhm, approximately one third less than the cheapest fossil fuel. Similarly, wind generated electricity fell by 69 percent to USD 0.033/kWh in 2022.
85 percent of global consumers want to go green
A report by McKinsey & Company in 2022 suggests that ESG investing will reshape global economies, killing off some markets but opening up new sustainable investing opportunities. It is now time for big businesses to identify and exploit the new green opportunities. This is particularly pertinent because the market for sustainable products and service is constantly growing and it was reported on Businesswire.com that 85 percent of consumers (globally) have already changed their purchasing habits in favour of clean industries.
David Viera, Managing Director of RA-ESG: “In summary, tempting as it may be to place the responsibility solely on world Governments to implement measures to fight climate change, the fact is that big businesses can make a dramatic impact by being more proactive with regards to implementing Environmental, Social and Governance policies. In our opinion global big businesses are stepping up to the plate, offering new and exciting sustainable investment opportunities whilst improving lives and appealing to a greener consumer base.”
If you would like to know more about RA-ESG.com’s ESG renewable energy investment opportunities, visit www.ra-esg.com or email info@raesg.x-co.dev.
Further reading https://www.sustainability.gov/pdfs/united-kingdom-nzgi-roadmap.pdf
