Just 65% of UK businesses have set 2050 net-zero target

An inaugural survey of UK businesses has revealed that 65% have committed to net zero by 2050, leaving 35% yet to set targets. Publishing the UK Net Zero Census, the government-industry-backed UK Business Climate Hub said the first results set a benchmark to track corporates’ net-zero progress but also flag areas where businesses require more support from policymakers.

The survey of more than 2,000 businesses across all sectors and all sizes finds that only 33% currently have a measure of their baseline carbon footprint, including scope 1, 2 and 3 emissions. This exposes a “gap between engagement and comprehensive action”, the report says. It stresses the urgency of measuring full baseline carbon footprints to set accurate reduction targets and track progress.

The survey also reveals 57% of UK businesses have so far developed a plan to reduce carbon emissions, with a further 24% planning to do so over the next 12 months. IT and communications companies polled much higher, with 68% of firms already having a plan to reduce emissions, with transport, logistics and storage firms at 63% and manufacturing at 60%.

While 73% of companies will prioritise net zero over the next 12 months, half said they face barriers. The UK Business Climate Hub acknowledges that “substantial challenges” to hit net zero remain, especially for SMEs. The survey finds that 59% of both SMEs and larger firms cite financial constraints as a significant barrier to achieving net zero.

“This underscores the need for tailored financial support mechanisms to facilitate progress towards decarbonisation,” the report says. It adds that only 25% of firms surveyed have accessed existing support through government grants and funding.

The UK Business Climate Hub recommends several areas for government action, including providing regulatory certainty for firms, which need a stable framework to plan and implement net-zero strategies. This regulatory framework should align with key international markets, particularly the EU, the hub says.

It also calls on larger companies to support firms within their supply chain on their path to net zero, offering mentoring and resources. It recommends the development of sector-specific decarbonisation plans to address key industry challenges, with larger firms playing a key role here too.

The survey finds evidence of external pressure for greater ESG transparency on firms, with 46% reporting that they have received requests for carbon data from customers. Some 90% of companies surveyed say they expect action on net zero will improve their organisations’ reputation.

“The results provided clear outcomes for policy makers, financiers and industry bodies to improve support for organisations, enabling accelerations of their progress toward net zero and helping to shape the policy environment that will propel UK industry towards net zero by 2050,” the report concludes.