What is the status of decarbonization in companies? How do decision-makers in particular assess the current situation and what are the typical hurdles? These are important questions for the market, to which the new Net Zero Report provides valuable answers. The comprehensive study by ENGIE Impact also recommends 6 strategic measures that should be a priority in every company. We provide some exciting insights into the study.
The Net Zero Report is a comprehensive research by ENGIE Impact. Every year, the consulting and service company determines the current state of greenhouse gas reduction efforts in the economy. The study results provide companies with guidance on how to get a little closer to their own Net Zero goals. As part of the representative, international study program, our colleagues at ENGIE Impact survey decision-makers from numerous industries for this purpose. A total of 505 business leaders participated in the new report between August and September 2022. People in companies with 10,000 or more employees were surveyed.
One encouraging figure in advance: In the 2023 Net Zero Report, 62 percent of the decision-makers surveyed said that their company has now made a public announcement regarding decarbonization targets. According to ENGIE Impact, this is right and important. And fundamentally, it's great that nearly two-thirds of companies are already making Zero Carbon a public issue today. At the same time, however, the report cautions that making a statement is only the first step toward a sustainable future. The will alone does not create an impact. When it comes to decarbonization, there is still a lot for companies to do - so what does it look like in practice?
The 2023 Net Zero Report suggests that a lot is currently happening in business. The results of the study show that 47 percent of decision-makers already consider their company's sustainability efforts to be "successful" or "extremely successful. In addition, 33 percent of those surveyed attest to their company's "moderate success. For the remaining 20 percent, however, the practical implementation of decarbonization is still "not very successful" or "not successful at all.
The data reveal an interesting development. As recently as 2020, i.e. 2 years ago, the picture was completely different. At that time, no decision-maker considered the measures to decarbonize their own company to be "extremely successful". Only 29 percent also said they considered themselves "successful" in decarbonization. Today, the figures make it clear how important the topic of zero carbon has become and how it has moved up the agenda of many companies - obviously with success.
The mindset is there, and many companies are already in the midst of successfully implementing their decarbonization strategy. Nevertheless, the 2023 Net Zero Report makes it clear that there are still many practical hurdles to overcome. For 75 percent of those surveyed, the first "quick wins" have been achieved. Now it's time for more challenging measures. However, many respondents lack government incentives for this, for example. Other factors include the shortage of skilled workers, hurdles with regard to the transformation of organizational structures and supply chains, and simply the difficult allocation of budgets.
Inevitably, the question arises as to how the decarbonization of companies can be approached strategically and skillfully today. Where are the current priorities to be set and what are the relevant levers and adjusting screws that give a push towards Real Zero? With the help of the findings from the study, ENGIE Impact can make a new recommendation. 6 important measures for decision-makers have emerged:
Decarbonization in companies is an individual process. There is no one strategy that works for everyone. That's why it's all the more important for decision-makers to develop a tailored model to get the maximum return on investment from investment decisions. To this end, many companies today are creating new decision-making structures at the local level, for example.
According to the Net Zero Report, there is a discrepancy between expectations of the impact of decarbonization measures between senior decision-makers and the employees who implement them. This can sometimes hinder ongoing processes. It is therefore essential that decision-makers align the company's vision with the operational perspective.
Empty promises and greenwashing should not exist in any company. And so it is crucial that executives feel responsible for their company's activities and are held accountable for them as well. In the best case scenario, decarbonization in the company is a matter for top management and enjoys the same status as financial goals. Incentives, for example in the form of a bonus program, can be decisive levers in this regard.
In order to achieve an impact with regard to the decarbonization of companies, decision-makers need the right tools. Three levers are particularly important: innovative financing models, CO2 pricing, and investment in data-driven processes.
Decision-makers cannot achieve successful decarbonization of a company alone - especially not in Scope 3. Initiatives and incentives throughout the company and beyond ensure that a zero-carbon strategy succeeds. And it does so along the entire value chain. This requires working closely with all partners in the supply chain.
The recommendations of the 2023 Net Zero Report are currently the most important cornerstones for a roadmap for the successful decarbonization of companies. According to ENGIE Impact, it is important to have confidence in one's own sustainability efforts and investments. Decision-makers should never pull budgets prematurely. After all, decarbonization is a process that only pays off in the long term and cannot offer a short-term return on investment. There are also many practical tricks and approaches that successfully set the course toward real zero. The report concludes with some concrete tips on how to implement the six measures.
You can now download the complete 2023 Net Zero Report with all insights free of charge from ENGIE Impact.
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