The government is out of touch with business who see net zero and climate action as a top priority, writes International Chamber of Commerce secretary-general Chris Southworth
There is no doubt that decarbonisation is now a major priority for UK businesses, and has been for some time. Forty-five million companies across the International Chamber of Commerce’s international network support the 2030 Sustainable Development Goals (SDGs), including a host of the UK’s largest trading companies.
The Prime Minister’s focus on the “costs” of delivering net zero as he announced a roll back of major climate policies misses the central point that we must reverse the increase on global temperature to avoid future risk to our economies and safeguard the planet for the next generation. We are a long way off track in keeping global temperature at 1.5C. We are currently on course for 3C degrees which will have a catastrophic impact on all areas of the economy. It is not a political choice. It is an urgent priority that we must all address if we are to avoid much higher costs in the future. It is also not fair to kick the can down the road for our children to have deal with and for whom this issue, quite rightly, really matters. It is about making hard choices now.
Net zero is an opportunity to invest in bright future of green jobs and economic growth. It is an investment in the long term prosperity of the country, not a cost to the present. No business likes uncertainty – it’s not good for investment. Changing the timeframes creates uncertainty and undermines confidence in the government which ultimately damages the ability to attract the investment we need. Let’s be clear, we need the investment to modernise and green our infrastructure, ensure our workforce has the right skills and to build the factories and manufacturing plants we need to grow the economy.
Government have been investing in battery capability, green steel and core infrastructure which is exactly what we need so it doesn’t make sense to then change the timeframes from a government investment perspective either. The risk now is that businesses will pause investment until there is greater clarity which delays the inevitable when we are better off investing now to build the capabilities we need to succeed in the future. How can businesses be confident in their investments and future planning if the government cannot be trusted to hold to its stated goals?
Businesses are an alarmingly long way in front of government on this issue. We can see this by the numbers of companies engaged in climate negotiations. At a recent Parliamentary event on the SDGs, there was a unanimous view from politicians, business and consumers that we must not back off our environmental responsibilities because of tough decisions. Quite the opposite, the view was that must accelerate investment in order to address the problem and capture the opportunity.
During an International Chamber of Commerce roundtable in 2019, I said that the UK was well positioned to present itself as a world leader on sustainability. But this didn’t happen. According to the United Nations Global Compact Network UK’s Measuring Up 2.0 report, there are gaps or inadequate performance from the UK on 64 per cent of the SDG targets. The most recent report in 2022 found 11 per cent of targets had poor or declining performance with little to no policy solutions in place. There is still no long-term UK industrial strategy for boosting growth and making tangible progress towards net zero.
Yesterday’s announcement sends all the wrong messages to the international community. It gives every other country the greenlight to also backslide on targets, none of which will help us address the climate crisis. This has to be a collective endeavour driven by clear, immovable targets and all countries working together. The UK must and should lead by example or it won’t be able to challenge others to raise ambitions. We will sink to the lowest common denominator and ultimately not do what needs to be done.
In a recent IPSOS Mori poll of countries who say climate change is a top concern for their country, the UK came seventh out of 29. In other words, there is wide support for climate action from not just business but also consumers who understand action is needed and hard choices need to be made.
The government are wrong on this issue. Delaying targets and deadlines is the wrong decision. Having a clear plan, delivering on the 2030 target and making the right investments that the country needs and people support is the right path to take. Chris Southworth, Secretary-General, ICC United Kingdom