US companies increasingly see the reduction of their carbon footprint as a key strategy for long-term resilience, growth and keeping customers, suppliers and investors happy. Research by Deloitte, Resources 2018 Study – Businesses Drive, Households Strive, found that commitment to environmentally friendly strategies is a priority for the majority of both US businesses and their customers.
Businesses pick up gauntlet
It also found that, while consumers think the government should be active in setting a vision and path for energy strategy, in fact the private sector is more proactive in advancing the cause to manage resources for cleaner, more resilient, secure and affordable energy supplies. One of the most interesting statistics identified in the research is that many US companies are going decisively against the direction of the Trump administration. While President Trump withdrew the US from the Paris Accord last year, three-quarters of companies that are reviewing their energy policies are actually increasing their commitment to sustainable energy management and investment. Overall, 87 per cent of businesses were familiar with the US pulling out of the Paris climate agreement, and four in 10 are reviewing or changing their energy management policies in response. “Businesses are not waiting for government to act on addressing climate change. They have picked up the gauntlet,” said Deloitte's Marlene Motyka. “They are now driven to double down on their energy management efforts as they view their long-term viability through the climate lens.”
The study also found that:
- About 70 per cent of customers are demanding companies procure a certain percentage of electricity from renewable sources.
- The number of companies with carbon footprint goals has jumped to 61 per cent in 2018, from just over half the year before.
- Sixty-eight per cent of residential consumers say they are concerned about climate change and their personal carbon footprints, outpacing the previous high of 65 per cent in 2016.
- Nearly three-quarters (74 per cent) of residential consumers stated that climate change is caused by human action, up six percentage points from 2017.
What are businesses doing?
What else are companies doing to lower their carbon footprint? Deloitte's research found companies taking the following steps:
- Business respondents expect gasoline or diesel vehicles to make up less than half (49 per cent) of their transportation fleets by 2020, making way for more hybrid and alternative-fuelled fleets.
- More than half (56 per cent) are supporting employees who drive electric vehicles by offering EV charging stations, with 52 per cent of companies owning those stations.
- Many businesses see reducing their electricity consumption as important to staying competitive.
- Fifty-nine per cent of businesses now generate some portion of their electricity supply on-site, and of those businesses, 13 per cent are using renewables, 13 per cent use on-site co-generation and 10 per cent are using on-site battery storage.
- Nearly half of business respondents are working to procure more electricity from renewable sources.
- Businesses are also responding to increased power outages by purchasing backup generators, adding battery storage units, and expanding the amount of electricity they self-generate.
CTMfile take: It is encouraging to read that businesses are taking up the challenge to reduce their environmental impact. As is mentioned in the report, the transformation of the electric utility sector will be key and will involve decentralisation, digitalisation, and decarbonisation.
Green and sustainable finance starting to actually save money/increase returns
#ACTAC18: This year’s discussion showed how the move to green finance is accelerating BUT much more needs to be done
Collaboration with c-suite needed to ‘wake up’ supply chain
Many supply chain executives are not leveraging their c-suite counterparts to improve supply chain functionality and transform it into an engine for new growth
Think strategically to improve climate-related risk reporting
Companies are identifying climate-related risks and opportunities but they are not taking strategic action to tackle those risks