Zurich calls for bolder climate policies to support net zero targets

Most companies (77%) across key sectors have a net-zero plan in place, according to research from Zurich Insurance, with 70% including targets in annual reports. But publishing its Sustainability Executives Survey of over 660 global executives with Horizon Group, Zurich urged changes to government policy to “unlock” progress on the climate transition. It called for more investment to share the costs of transition to net zero between the private and public sector and an innovation pipeline to foster collaboration between business leaders, governments and researchers, alongside a long-term funding programme. “Many companies are committed and making progress but need support from public sector stakeholders to channel investment and provide greater policy certainty around climate transition,” Zurich said. “All industries need more support and acknowledgment from policymakers on the cost and scale of the transition… The private sector can shoulder only some of the transition costs. Bolder government policies and increased public investment are required to shift support from the old energy economy to the new transition economy,” it added. Zurich said removing fossil fuel subsidies and introducing well-designed carbon pricing mechanisms are key steps. “Both technology and policy are consistently important drivers across sectors and geographies. Scalable and readily applicable innovations to support the transition to net zero are needed. These can be developed and deployed only if a supportive broader industry ecosystem is in place that comprises key industry players, research institutions and public-private collaboration in research and funding,” Zurich said. It added that technology “needs to go hand in hand” with stronger climate policies to help drive companies’ net-zero plans. Firms in Asia Pacific are the most likely to have a net zero plan at 85%, Zurich’s research finds, while companies in finance and energy outperformed the average at 88% and 85% respectively. “The energy sector’s transition to net zero is important not only because it is responsible for the largest share of global greenhouse gas emissions, but also because other sectors (such as transport, food processing and industry) depend on electrification as the basis of their net-zero strategies,” Zurich explained. Switching to renewables was the most common net zero target for 42% of companies. But again, Zurich said coordinated policy action is needed to help switch to renewables. Eighty percent of companies in heavy manufacturing, consumer goods and agriculture have net-zero plans. Transport was the only outlier, with only 37% of companies in the sector having a net-zero plan. Focused mainly on what is driving corporate strategies on climate change mitigation and adaptation for scope one emissions, the survey found technology and legislative policy are the main incentives for the transition to net zero. Zurich said most companies are focused on resilience and adaptation alongside emissions mitigation. Some 85% said they intend to implement adaptation measures within the next five years, led by companies in the heavy manufacturing sector. “In particular, companies across sectors indicated concern about supply-chain risks as they navigate the transition to net zero,” Zurich said. Half of survey respondents identified the cost and scale of capital required as the main barrier to transition, followed by lack of technological solutions and regulatory challenges. The lack of clear and credible data was also cited as a problem for mapping and tracking emissions.

Zurich calls for bolder climate policies to support net zero targets

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