Global warming, and how society can contribute to reverse its adverse effects through climate action is steadily growing as one of the most popular and crucial topics of discussion in the modern age. As climate change continues to threaten entire ecosystems and our traditional ways of life, more and more people are concerned about how we can contribute to preventing the havoc wrecked by the climate crisis. As everyday citizens continue to mobilise and organise for urgent climate action, they do not just focus on reducing their individual carbon footprints but turn their attention to governments, industries, and mega organisations.
Consumers are growing more conscious and careful about the products they spend their money on and engage with. As climate consciousness deepens, people are reluctant and less inclined to support businesses and companies that do not do their part to help the environment and reduce their carbon footprint. In a Futera survey of over 1000 consumers in USA and UK reported in Forbes magazine it was found that “88% of people want brands to help them be more environmentally friendly and ethical in real life”. Further results of the survey showed that consumers want the brands they buy from to be climate positive and make it easier for them to be environmentally friendly and ethical in their daily life as well. This means that the products that they buy from a company must have a negligible carbon footprint and be ethically sourced.
As time passes, we can see that climate action and carbon neutrality are not just buzzwords but key aspects of how economies function in the societies of today. Sustainability is no longer a trend or a fad, but is steadily becoming an entrenched part of the way people consume and engage with businesses and how they function in their daily lives. To not take part in carbon neutrality means to be left behind in a world that is becoming more conscious, caring, and protective of the environment and the Earth we live in every day.
Reasons to go Carbon Neutral
1. It is More Cost-effective
Going carbon neutral usually involves cutting back on unnecessary expenditure of all forms of energy and utilities – electricity, water, fuel, heating, cooling, etc. When a company decides to improve upon their energy combustion and reduce the amount of carbon emissions they let out in their activities, they do not only help the planet from global warming but it also tends to be cheaper for them. Reducing use of electricity, water, and other utilities also ultimately saves a company money that is spent on utility bills. Thus, it cuts excess costs as well as reduces the amount of carbon emissions a company is credited with. Unilever is one such company whose energy efficient brands, like Ben & Jerry’s and Dove have grown 46% faster than other brands from their portfolio and thereby generated 70% of the company’s turnover growth.
2. Attract and Sustain More Employees
As climate change grows more important, consumers are not the only individuals who are concerned with the carbon footprint and environmental consciousness of companies and organisations. Employees also want to work for companies that take global warming seriously and do their part to mitigate the adverse effects of climate change that they contribute too. Much of the entering workforce are people from the younger “Millennial” or “Gen Z” generations which are serious and obstinate about ethical workplaces and climate action. A survey from the Department for Business, Energy and Industrial, Strategy (BEIS) found that 65% of 16-24 year olds would choose a job in the green economy. This is a clear indication of the fact that the emerging workforce is passionate about jobs which have a positive environmental impact and do not contribute to global warming.
3. Consumers Prefer Environmentally Conscious Organisations
With the popularity of climate action and eco-friendly lifestyles, it comes as no surprise that large numbers of consumers tend to gravitate towards brands and companies that take climate change seriously, and who make concerted efforts to reduce their carbon emissions and pledge carbon neutrality. As mentioned before, a Futera survey of over 1000 consumers in USA and UK reported in Forbes magazine found that “88% of people want brands to help them be more environmentally friendly and ethical in real life”. Committing to carbon neutrality and being environmentally friendly are sure ways of reaching out to loyal customers and maintaining a sustained interest in your company’s products.
4. Increased Profits
Since consumers are inclined to support environmentally friendly brands, it comes as no surprise that brands that are carbon neutral will naturally have more people buying their products and as such, will have larger profit margins. In a survey of 1,084 Americans conducted by LendingTree, it was found that 55% of respondents are “willing to spend more on sustainable and eco-friendly products, while 4 in 10 are willing to go a step further and boycott companies that aren’t so keen on going green.”, 58% and 50% of Gen Z and Millennial consumers respectively are more likely to boycott a company that is not eco-conscious. Thereby, being committed to carbon neutrality is not just profitable but imperative in the current and coming economy. A lack in climate consciousness could cost a company a large chunk of revenue and sales.
5. Investors and Stockholders Prefer Carbon Neutral Businesses
With the growing realisation that climate action is not a mere trend but a long lasting reality, more and more investors and stockholders are tuned in to the fact that carbon neutrality is the future of business and so are investing in environmentally friendly companies is the most profitable way forward. Laurence D. Fink, the chief of the BlackRock company, wrote in his annual letter that “the evidence on climate risk is compelling investors to reassess core assumptions about modern finance.” His statement was accompanied with BlackRock Investments shifting their investments, since sustainability was now seen as a key aspect of investment decisions. Barclays has also found that their bond portfolios that showcase clear goals for sustainability have fared better than those with weak environmental targets in the past seven years.
6. Keep Up with Competition
Understanding that the economy of today and the coming years is partial to green businesses and eco-friendliness, major corporations have committed to climate action and reducing their carbon footprint. Major companies like Starbucks, Amazon, Unilever, Microsoft, JetBlue, etc. have already pledged to be carbon neutral and contribute to the effort fighting climate change, making it imperative for other companies to follow suit in order to survive the competition. Companies such as these often dictate the terms of the industries they function within, and they are all committing to climate action and environmental consciousness which means that these practises will not just be recommended but the norm in these industries.
7. Climate Agreements and Policies Will Soon Regulate Business
Due to mass movements calling for climate action and sustainable ways of living, governments across the globe have been spurred into enacting legislation that makes environmental consciousness and carbon neutrality a fundamental aim of conducting business. The COP26 saw a greater number of nations coming together to combat the worrying effects of climate change; this included but was not limited to reducing their respective countries’ greenhouse gas emission rates, their carbon neutrality, as well as their commitment to clean energy. With the USA re-entering the Paris Agreement there is a greater thrust towards climate action policy which means that businesses all around the globe will have to follow the climate mandates of the countries they operate in. Since major economic hubs like USA, UK, Europe, India, China and other Asian countries are party to international climate agreements, the large chunk of companies will have to follow the climate regulations that are enforced in these nations. In this situation, it is pertinent and more profitable to get a head start on making one’s company carbon neutral since all decisions would be made independent of local climate laws. Getting a head start in climate consciousness and reducing greenhouse gas emissions early will make a company more adaptable when climate regulations do roll around, making it easy to adjust to new laws and policies.
8. Climate Change Affects Everyone
Climate change is a phenomenon that affects all countries, societies, businesses, and industries. The reality of our globalised world is that we are all interconnected and our realities are intertwined. The adverse effects of climate change are ultimately felt by everyone and as such have adverse effects on the economy and business too. For example, if farmers in North America experience a bad harvest due to drought caused by climate change, it is not just their individual farms that lose money, but also big businesses like WholeFoods and Trader Joe’s that source their produce from farms across America. This is a small example of how interconnected the effects of climate change are.
9. Conscious Consumerism Is Here to Stay
One thing that has been established is that consumers being concerned about ethics and environmental consciousness is not a trend. Sustainability and veganism are some of the most widely followed movements, and younger generations have made the commitment climate consciousness a part of their daily lives. Climate action is a foregone conclusion, and is no longer an optional practise for the majority of Gen Z and Millennials. A survey conducted by Accenture of 6,000 consumers in 11 countries across North America, Europe and Asia showcased that although consumers care about quality and pricing “83% believe it’s important or extremely important for companies to design products that are meant to be reused or recycled” and 72% of respondents said they’re currently buying more environmentally friendly products than they were five years ago, and 81% said they expect to buy more over the next five years.
10. Climate Change Is Real and Affecting the World’s Future
The most important reason why companies should become carbon neutral is perhaps that in no uncertain terms, the existence of our world depends on climate action. Carbon neutrality and greenhouse gas emissions reduction is not just about making ethical decisions that are kind to the environment, but fundamental to the survival of the human race and planet Earth. The UN Sustainable Development Goals affirm that “Climate change is now affecting every country on every continent. It is disrupting national economies and affecting lives, costing people, communities and countries dearly today and even more tomorrow.”