No, climate action will not damage business interests
Green and economic growth come hand in hand, say Sophie Miremadi and Alex O’dell, co-chairs of the Corporate Leaders Group UK
With the UK general election just two weeks away the one thing that the Conservative and Labour parties can agree on is the urgent need for higher growth in the next five years.
Whichever party is elected, it will need to deliver this in an increasingly protectionist international market. Both the US Inflation Reduction Act and Europe’s Green Deal have sought to spur investment in renewable power, energy efficiency including EVs, the building stock, technologies and infrastructure, to the advantage of their domestic industries. In this ever more competitive environment, the UK must offer a clear and globally compelling vision for green growth, underpinned by innovation. Doing so will build on Britain’s already world-leading status as an innovator – and help to incentivise many leading domestic companies, which are already working towards climate neutrality themselves.
Both the US Inflation Reduction Act and Europe’s Green Deal have sought to spur investment to the advantage of their domestic industries
Working with progressive companies all over the country, at the Corporate Leaders Group UK we are rejecting business as usual and investing in sustainable growth. At Velux for example, the company is working with its value chain to drive down the embodied carbon in its materials – switching to recycled aluminium and ensuring its operations can fully run on renewables. Aveva’s technology is supporting industrial companies across all sectors to decarbonise their operations, while enabling the scaling up of renewable power generation and acceleration of essential supportive technologies, such as sustainable fuels and carbon capture.
But businesses can’t do it alone. We also need the government to match these commitments and to work hand in hand with industry to ensure a smooth and just transition.
In recent years, there have been many successful examples of business and government uniting to drive change. Back at Cop26 in Glasgow, the UK pioneered the way with new legislation on the need to disclose climate-related financial information, for instance. This made the UK the first G20 country to mandate publishing corporate information relating to climate risk. The Taskforce on Climate-Related Financial Disclosures (TCFD)’s recommendations have since been widened to include public bodies and have become the gold benchmark for international reporting on sustainability standards.
The world has changed since then. We have emerged from a global pandemic, an energy crisis due in part to the war in Ukraine and still now – geopolitical tensions weigh heavy. In response to this ongoing crisis, bold thinking and deeper collaboration, alongside a stable regulatory framework, are needed in the run-up to 2030. Government has an important role to play in setting a clear, consistent strategy that sends reliable signals to the private sector. This can empower businesses to invest for the medium and long-term, counting on political leaders to support them. We argue that this bigger thinking will also make the UK more competitive on the world stage.
As a leading business group, we see no trade-off between economic growth and radical action to accelerate the green transition. On the contrary – by setting out a clear policy framework this helps businesses to have the certainty they need to invest and the government will drive competitiveness, spark innovation and rally the workforce behind its cause. But how can we be so sure?
We know that the green transition will generate a range of benefits, from related job growth to lower energy bills. For example, every job lost in fossil fuels will create two more in green technologies; increasing the renovation rate of the building stock will improve health and well-being for users with significant, derived financial benefits, too, and the proliferation of solar power is creating prosumers – customers who generate as well as consume electricity. Leading power companies in the UK are finding ways to harness that fresh resource, increasing grid resilience as they uncover new sources of revenue. This is innovation in action and, as businesses, we need to secure the investment to deliver sustained and focused ideation and delivery, via a compelling, internationally competitive, green growth plan.
Both parties have said economic growth is their number one priority: green growth is the best opportunity for the incoming administration to show the world what they’ve got.