Sustainability is going to be more important to large companies as a result of Covid-19, according to research commissioned by the Carbon Trust. Over 70% of companies interviewed for the research said environmental management and/or sustainability priorities are likely to become ‘somewhat more important’ or ‘significantly more important’ for them as a result of Covid-19.
Even those companies that have been significantly impacted by the pandemic still believe sustainability is going to become more important. Of those experiencing significant disruption, 69% expect environmental management and/or sustainability to become somewhat or significantly more important.
The Carbon Trust commissioned B2B International to undertake the ‘Corporate attitudes towards sustainability’ research for a second year. It conducted 453 interviews with large companies (minimum 1,000 employees and over a quarter with more than 5,000 employees) in the following countries: Germany, France, Mexico, Singapore, Spain, and the UK. The research was undertaken in July of this year so does not reflect business confidence following more recent ‘second spikes’ in Europe especially, however our experience suggests that the findings are likely to still be accurate.
Hugh Jones, Managing Directory, Advisory at the Carbon Trust commented: “The findings of this research are consistent with what we are seeing in the market. Sustainability is rightly a growing business priority and the increasing demand for our services aimed at helping corporates to decarbonise and adapt for the future demonstrates that, despite extremely challenging market conditions, this is one area that businesses are continuing to prioritise. “The global health crisis is perhaps elevating the need for action on risk in boardrooms globally, and the climate crisis presents risks that no business can afford to ignore.”
Three quarters of organisations interviewed had been negatively impacted by Covid-19 – with 4% saying it represented an existential threat to their organisation from which they may not be able to recover, while 32% said they had been significantly impacted by the pandemic, with operations heavily impaired, or sales/revenue badly impacted. The worst disruption was experienced in Spain but the impact was reasonably consistent across all geographies.
Large companies in Germany and Mexico are most likely to think their sustainability priorities will become more important as a result of the pandemic (82% and 79% of those interviewed in each country respectively) with sustainability covering the use of natural resources and reduction of environmental impact across the organisation. The sectors that are most optimistic about the growing importance of sustainability as a corporate priority are wholesale and retail, construction, engineering and mining, manufacturing, and healthcare. No matter what the sector, only around a third of companies expect there to be no change or that environmental management/sustainability will become less important.
Hugh Jones, Managing Directory, Advisory at the Carbon Trust added: “Organisations around the world are considering their role in delivering a green recovery – achieving net zero targets at the same time as fostering economic activity. We know from working with corporate clients on their net zero targets and strategies, that many will be leading the way when it comes to achieving green growth and these research findings support this. Without corporate commitment a green recovery will be challenging to deliver so the research is great news.”
Budgets for sustainability are also expected to increase as a result of Covid-19 – 63% of those interviewed said their budgets will get ‘significantly’ or ‘somewhat bigger’ and only 16% said they would be ‘somewhat smaller’.
The majority of companies (74%) believe that sustainability will become more important to their customers as a result of Covid-19 – with almost a third saying it will become ‘significantly more important for their customers’ – and this is especially the case in Mexico (82%), Germany (81%) and Spain (79%).
This is the second year that the Carbon Trust has commissioned research on attitudes towards sustainability, although this year has seen the addition of companies from Singapore, Mexico and the UK to the research.
Compared to 2019, all trackable markets have seen environmental management/sustainability become more of a priority for organisations, especially in Germany. More organisations also have dedicated sustainability professionals than in 2019 (39% in 2020 compared to 35% in 2019), although now half of companies say that this role is combined with other duties (up from 46% in 2019).
The corporate response to Covid-19 and the economic challenges that it has created will be a key focus for the Carbon Trust’s Corporate Sustainability Summit taking place virtually on 14 October. Featuring powerful keynotes from speakers including: Dr Marcia Balisciano, Chair of the UN Global Compact Network UK and Head of Corporate Responsibility, RELX; Steve Martineau, UNFCCC COP26 Climate Champions Lead for Mobile and ICT; Lei Zhang, Founder and CEO, Envision Group; and Baroness Brown of Cambridge, Deputy Chair of the Committee on Climate Change and Chair of the Carbon Trust.
Download the report: Corporate attitudes towards sustainability 2020 (pdf)