NEW research has revealed that a ‘significant gap’ in C-suite understanding about how to calculate a company’s carbon footprint is threatening to ‘undermine’ progress to net zero and could impact UK competitiveness.
The research, by management consultancy Vendigital, was conducted with 152 C-Suite executives at UK-based manufacturing companies. 74% said they would like to know more about their carbon footprint, indicating their current knowledge is incomplete.
Dominic Tribe, director at Vendigital, said, “There is a significant gap in understanding about carbon emissions, which is threatening to undermine progress to net zero. While many manufacturers understand the importance of reducing carbon emissions in areas such as transportation and logistics, relatively few have a handle on their operating emissions and even more so the cumulative carbon footprint of their bought in parts and raw materials from their supply chain.
“Without access to reliable emissions data, businesses are unable to accurately monitor and improve their environmental performance, which could impact their competitiveness in the future.”
The research revealed the top four reasons given for wanting to know more about their company’s carbon footprint were: to do the right thing; strengthen customer and investor relationships; enhance enterprise value; and become more attractive as an employer.
However, the research revealed low levels of investment in some areas, with more than a third of C-suite executives yet to appoint a head of sustainability or ESG (35%) or implement a green sourcing strategy (34%).
“The lack of investment is concerning when you consider that decarbonisation initiatives can take many years to implement, and even longer to deliver a cost benefit,” Tribe added. “Without immediate action, UK manufacturers could lose ground in the race to net zero.”
69% of respondents said they would only adopt a net zero-led sourcing strategy if it delivered a net cost benefit too. Despite concerns about balancing cost and rewards, the research found that most manufacturers are aware that demand for greener products and operating processes is becoming more prevalent across the supply chain. 80% of manufacturers believe sustainability/ESG performance has a direct impact on customers’ buying decisions and 20% confirmed that new customers ask about a product’s carbon footprint.
Vendigital has published a white paper called Achieving Net Zero Manufacturing, which presents the research findings and sets out strategies to help manufacturers balance costs and rewards in the pursuit of net zero.