The societal focus on net zero transformation has seen private businesses facing increasing pressure from various stakeholders to reduce their carbon emissions and embrace sustainable practices.
Increasingly this market pressure, alongside shareholder demands, and investor expectations are pushing organisations to prioritise sustainability. While changing consumer preferences, and supply chain cost pressures further contribute to the urgency of embracing net zero transformation.
Disclosures that were initially voluntary, such as TCFD and CSRD reporting, are also transitioning to mandatory ones, for example TCFD is mandatory for companies with over 500 employees and £500m in turnover and CSRD is mandatory for large private companies. Private businesses need to adapt to stay compliant and their customers also may need to comply with regulation. However, there is a global shortage of capability to address this new paradigm effectively.
At PwC, we can help to identify and reduce carbon emissions across an organisation's operations and value chain. Across all stages of the transformation journey, we support with:
Maturity and baselining - assessing existing net zero initiatives and scope their emissions as they currently stand
Target setting and strategy development - understanding the implications and opportunities for net zero in the wider commercial strategy of the organisation
Transformation roadmap - turning ambition into actions, identifying levers to reduce emissions and outlining a bespoke transformation roadmap to deliver on the Net Zero strategy of the business
Transformation implementation - executing on the roadmap by transforming the organisations operations to deliver on the Net Zero strategy, and implement across the organisation
"Collaborating with experts can help private businesses assess their greenhouse gas inventory, set science-based targets, and implement decarbonisation strategies effectively."
Our recent CEO survey revealed that 75% of UK organisations are actively planning or delivering a transformation project focused on sustainability. Private businesses, ranging from large family-owned enterprises to mid-tier and smaller organisations, are increasingly recognising the importance of being early movers in responding to the climate challenge. For instance, John Lewis, a partner-owned organisation, has implemented sustainability initiatives like tech and fashion recycling and fashion rental services.
Private equity-backed organisations also face pressure from investors to set net zero targets and develop credible transition plans for their assets. However, many businesses lack the in-house capabilities to take action on their commitments, necessitating external support. Collaborating with experts can help private businesses assess their greenhouse gas inventory, set science-based targets, and implement decarbonisation strategies effectively.
One example of this is our work with a leading UK independent leasing fleet management firm. This private equity backed firm serves as an example of successful net zero transformation. By working closely with the private equity firm, we helped create a climate program, including science-based targets and decarbonisation guidance for the company’s entire portfolio. Our expertise in working with the industry-leading standard for net zero commitments, the Science Based Targets Initiative (SBTI), enabled the company to assess its greenhouse gas inventory and address potential gaps.
Taking proactive steps towards net zero transformation offers several benefits for private businesses. It ensures compliance with emerging regulations and avoids potential penalties, it enhances brand reputation and attracts environmentally conscious customers and also drives cost savings through energy efficiency measures and optimised resource utilisation. All of these measures will help to future-proof businesses by mitigating climate-related risks and ensuring long-term sustainability.
Net zero transformation is no longer an option but a necessity for private businesses. The increasing market pressure, regulatory requirements, and changing consumer preferences demand a proactive approach towards decarbonisation. By embracing net zero transformation, private businesses can unlock numerous benefits, including enhanced brand reputation, cost savings, and long-term sustainability. Partnering with experts in the field can provide the necessary guidance and support to navigate this transformative journey successfully.
