one year later COP26, United Nations Conference on Climate Change to take place in November 2021, number of companies in FTSE 100 oath to achieve net zero emissions by 2050 increased by 37% to 82%. Among the mortgagors are some of the largest companies in the world: Amazon, Apple, Ford, IBM, JP Morgan, Mars and many others. But climate action isn’t just on the minds of industry giants: it’s a growing concern for every business as scrutiny grows.
Making a commitment is the easy part. In 2023, we will see businesses held accountable for what they actually deliver. Organizations will be forced to demonstrate that the commitments they have made are meaningful, providing transparent and ongoing evidence that they are taking the necessary actions to reduce their carbon footprint.
Skepticism on the rise of overly ambitious, unclear and even deceptive climate commitments are putting pressure on businesses. We are now seeing customers vote with their wallets, employees choosing employers based primarily on zero net credentials, and investors making choices on what to fund based on. tangible climate action. To put it into numbers, as much as 60 percent of millennials willing to pay more for truly sustainable products; two-third of people are more likely to work for a company with strong and meaningful environmental policies; and Amazon research has found that as many as 83 percent of investors who want to invest in more sustainable startups.
For a long time, businesses have poured money into traditional offsets—paying others to reduce future emissions to compensate for themselves. Offset measures to avoid emissions include clean kitchen projects, investments in renewable energy, and forest protection.
As attention shifts to distribution in 2023, awareness will grow that these traditional offsets are at best a distraction that doesn’t count towards net zero and at worst completely. cheat. So far, offsetting carbon has been an easy, inexpensive way for businesses to tick the sustainability box, allowing them to tell a story of their commitment and willingness to tackle the climate crisis. In 2021, more than 1 billion USD of offset has been sold.
In 2023, businesses under pressure from all sides will need to look to other solutions if they want to prove delivery. For example, awareness of carbon removal technologies has increased. There is now a broader understanding and acceptance that these technologies, which actively suck carbon out of the atmosphere through direct air capture, weather amelioration, and other methods, are critical to achieve our global climate goals. And progress has been made—in 2022, a host of major Silicon Valley companies, including Google, Meta, and Shopify, have formed an alliance to commit 925 million USD in removing carbon by 2030. While this is a promising step, access to and investment in carbon removal technologies must become mainstream if they are to go from infancy to scale at the speed the planet needs.
By 2023, a climate commitment will be just the baseline, the bare minimum. Everyone on the board will demand more from the business they work for, spend money on, and invest in. Those who cannot demonstrate tangible progress towards their net zero goals will be left behind.