The Carbon Trust : Britain’s business leaders believe the UK is lagging behind Germany in the race to capitalise on green business opportunities.
A Carbon Trust investigation reveals that three times as many top UK decision makers believe Germany is better prepared than Britain to take advantage of the £3.2 trillion global environmental market.
The research coincides with the launch of a new Carbon Trust ‘Green Growth’ campaign backed by business leaders including; Ian Cheshire of Kingfisher; Lord Sharman of Aviva; Mark Elborne of GE, and Richard Evans of Pepsico UK & Ireland.
CEO of the Carbon Trust, Tom Delay said:
“Green growth is the only show in town. No other sector can drive the recovery. The consequences of British business failing to grasp this opportunity are almost too horrific to consider: anaemic growth, a jobless recovery and the risk of a return to the economics of boom and bust. We cannot afford to carry on as we did before.
“Businesses need to look beyond the short-term financial reporting cycle and place some smart, early bets on the future. Otherwise the cost, both to the UK’s economy and to the environment will be too great to ignore.”
The Carbon Trust survey of decision makers in top UK businesses found that while 92% believe green growth represents an opportunity for their business, only a third are actually investing money in the research and development of green products and services.
Of those surveyed, the greatest numbers of bosses - 34% - believe that of all the nations, Germany is best prepared to benefit from green growth, whereas the UK is lagging far behind – with only one in eight citing the UK as the most prepared nation.
The Carbon Trust research suggests that “leadership” is vital to any company seeking to take advantage of growth in the green economy. Three in four decision makers citing this as the number one requirement.
The majority of business leaders questioned – 77% – state that the key benefit of ‘going green’ is to enhance their corporate reputation.
However, a third say that that having a “sustainable” business plan can actually increase profits.
The environmental and low carbon market is worth over £112bn a year in the UK and employs over 900,000 people. It is forecast to grow by 25% over the next four year.
Ian Cheshire, Group Chief Executive for Kingfisher
“Rising energy prices are one of the biggest worries facing British businesses and yet by taking some relatively simple measures, energy bills can be drastically reduced to generate ongoing annual benefits for a bottom line. I’m sure many business leaders recognise the opportunities green growth represents, yet very few are actually investing to enable them to capitalise on this market.”
Richard Evans, President, PepsiCo, UK & Ireland
“Sustainable businesses that invest in green economic growth can cut costs, drive innovation, reduce risk and motivate employees. Working with the Carbon Trust to footprint and label our products has allowed us to reap those benefits as we continue on our path to zero environmental impact."
Simon Walker, CEO, British Venture Capital Association
“The Government has taken positive steps to be the greenest one yet. Whether through the Green Deal, the Green Investment Bank but also by taking a sensible approach to work with the business community to deliver Carbon Reduction Commitments. But as this timely research shows there is more work to be done to raise awareness of green business opportunities. As the representative of UK private equity and venture capital, key financiers of British businesses including many in the green space, the BVCA welcomes this contribution and will continue to do our part to raise awareness of the green growth agenda.”
John Walker, National Chairman of the Federation of Small Businesses
“The FSB warmly welcomes the Carbon Trust’s Green Growth campaign. 2011 needs to be the year when the low carbon economy becomes a priority for Government plans for growth. We are therefore concerned to see that the Carbon Trust’s research shows the UK is lagging behind countries such as Germany in terms of realising the potential of the low carbon investment. Firms across the UK need to realise that there is huge potential to generate green growth and boost their profits by investing in the low carbon economy.”
Gaynor Hartnell, Chief Executive, Renewable Energy Association
“Renewable energy must expand faster in UK than virtually every other European Member State. As well as creating fantastic opportunities for renewables companies, energy users are being encouraged to install their own renewables equipment. As well as enhancing their corporate reputation, they’ll be investing insuring themselves against future energy price hikes.”
Lord Sharman, Chairman, Aviva
“We feel that sustainability is sufficiently material to company performance to warrant disclosure, which is why Aviva attributes the same seriousness to reporting sustainability results as it does its financials."
“As a publicly owned organisation, it makes sense for us to stay ahead of oncoming mandatory carbon regulation. By getting third party accreditation of our carbon footprint from the Carbon Trust Standard, we can guarantee the same level of reliability and robustness of data for financial and non-financial reporting – making firms more attractive to investors and the financial markets.”
Ronan Dunne, UK Chief Executive, O2
“At O2 we passionately believe that a smart business is a sustainable business. This is not just about the cost savings you can achieve through cutting waste. If good business is about delivering on what your customers value, and if they increasingly demand sustainable products and services, then investing in this area makes business sense. From Sim only deals which encourage customers to hang onto their handsets longer through to helping our corporate customers benefit from flexible working technologies, we are investing in green products and services because it’s good for our customers, which in turn means it’s good for us as a business.”
Mark Boocock, Managing Director, Econotherm
“We are overwhelmed with demand for our products from all corners of the globe including India, Italy, Chile, Middle East, Eastern Europe and Malaysia. Whilst it is extremely satisfying that we are manufacturing and exporting this patented technology from our UK production facility we remain surprised at the relatively low level of domestic industrial demand. The carbon reduction opportunities are omnipresent. Our technology can achieve a 15% - 25% reduction on a piece of industrial equipment such as a boiler or furnace and a customer recently told us that they had achieved their whole site’s 5% reduction target by installing our technology on just two of their steam boilers. Large energy users in the UK can no longer afford to ignore this opportunity.”
Terry Last, Chief Executive, Tarmac
“Focusing on green growth and developing a lower carbon economy is not only essential for delivering on the UK’s climate change commitments, it is also critical to unlocking important economic opportunities for us all. Certainly, we recognise that Tarmac, along with the wider construction industry, has a pivotal role to play in achieving these goals, and, as such, sustainability and delivering a greener, more carbon-efficient future sits firmly at the core of our business strategy. For me, these are not empty words. There is a real commitment to continually develop lower-carbon solutions by focusing on whole-life carbon efficiency and, supporting our business and customers in working towards a lower carbon future.”
David Camp, Chief Executive, Stanhope PLC
“We are very happy to support the Carbon Trust’s Green Growth initiative. Investment into the low carbon economy is not optional – it should be the norm.”
Adam Fowle, Chief Executive, Mitchells & Butlers
"Our strategy for the next three years is to focus on ensuring that energy efficiency and carbon reduction is a part of our everyday business culture and we are continuing to invest in a number of energy saving projects across the business."
Patrick Dempsey, Managing Director, Whitbread Hotels and Restaurants
“We’re serious about sustainability at Whitbread because we know it is what both our customers and our team want. We also know that it can give us competitive advantage. That’s why we are looking at sustainable "green and grow" developments such as our low carbon Premier Inn hotel and Beefeater Grill restaurant in Burgess Hill, West Sussex and investing £7 million this year in retrofitting improvements across the Whitbread estate which will help save energy, CO2, water and, of course, costs. We call our corporate responsibility programme ‘Good Together’ and it is our solution to embracing sustainability, embedding it into our business, and showing leadership in areas where we can all work together to make a big difference.”
Martin McAdam, Chief Executive, Aquamarine Power
“The UK had a global lead in wind energy technology, yet a lack of commitment by government resulted in the industry’s phenomenal growth in Denmark and Germany.
The UK now has the opportunity to develop a world-beating marine energy sector, with massive potential to provide jobs and economic growth. In less than four years my company has grown to more than 50 highly qualified staff and our goal of making commercial wave energy devices already supports a supply chain stretching from SW England to the Orkney Islands. I would urge the government to increase its commitment to this vibrant new sector and place green growth at the heart of its economic strategy.”
Richard Gillies, Director of Plan A, CSR and Sustainable Business, Marks & Spencer
“Through Plan A, our ethical and environmental programme, we’ve proved that doing the right thing makes complete business sense. By increasing our energy efficiency and creating new markets such as M&S Energy, Plan A is not only profitable but also helps the environment. We still face many challenges in becoming a truly sustainable business, but we know the green growth market offers us and other businesses huge opportunities. Because of this, we’ve long said that sustainability is critical to future business success, that’s why we’re supporting the Carbon Trust’s Green Growth campaign.”
Kevin Hurst, Marketing and Communications Director, Veolia Environmental Services
"We are committed to environmental sustainability both in progressively reducing our own carbon emissions and helping transform the perception of the industry by working with local authorities, business and residents to promote turning waste into a resource. The low carbon economy represents a vital source of future business growth and by investing in a host of initiatives from green treatment technology and hybrid vehicles to recycling incentives and recycling education packs we can turn this into a reality."
Paul Kelly, External Affairs and Corporate Responsibility Director, Asda
"As the lowest priced supermarket, our customers rely on us to offer them affordable products. Being more sustainable has delivered both significant financial and environmental savings which enables us to save our customers money every day.
In these tough economic times businesses and the Government need to redouble our sustainability efforts to create a low carbon economy that helps hard-pressed consumers make ends meet."
Peter Bance, Managing Director, Ceres Power
“Ceres Power started in 2001 with a material science breakthrough in electrochemistry. We have now become a recognised leader in cleantech with our residential CHP product now entering field trials in the UK, having received CE approval. Since the company was founded we have secured tens of millions of pounds of investment from strategic partners like British Gas and our other blue chip shareholders. The venture capital and R&D grant support we received from the Carbon Trust in the early years helped us transition from the lab into pilot scale production and establish our low carbon credentials.”
Paul Lazarevic, Managing Director, RLtec
“2011 is a significant year for RLtec. The trials with major players in the commercial and domestic markets have now been proven in the field, and ultimately unlock an international market for dynamic demand technology. We’ve gone from a team of six developing a prototype to a company of over 30 personnel, with a world’s first Smart Grid technology in just over two years. In 2011 we expect the company to continue growing, both in size and profitability, and the support of the Carbon Trust has been instrumental. They have helped us leverage investment from the private sector and to raise our profile in the industry – this has been a major benefit.”
Jonathan Luke, Chief Executive, Senselogix
“We started SenseLogix in June 2009 and approached the Carbon Trust seeking support to develop our business and retrofit energy reduction technology. Fortunately, the Carbon Trust understood our business goals and saw that our technology would provide significant energy and carbon savings in the existing built environment, particularly in the workplace, office and education sectors. SenseLogix technology automates the implementation of best practice into the workplace, a key energy initiative the Carbon Trust has been promoting for a number of years, and has the ability to crossover boundaries in IT power management and energy management of building services, delivering extremely energy efficient buildings. The support we received helped us generate prospective sales in excess £3M, secure important strategic partners, and close our series A investment round.”
Chris Smith, Managing Director, G-volution
"Sustainable development requires leadership from all levels of business. There is much opportunity, but only those who are prepared to take risk – or at least the perception of risk – will really reap the rewards. Low Carbon businesses (like ours) need leadership from across each company, from the workshop to the Board room – to really make change happen."
Chris Kirby, Managing Director, Magnomatics
"Magnomatics is at the forefront of groundbreaking magnetic gear developments and our Company has chosen to focus on low carbon applications in order to maximise profits and growth rate. With reliability and efficiency benefits for applications from offshore wind energy through to wheel motors for hybrid electric vehicles, our addressable low carbon markets are worth billions of pounds. Carbon Trust support is facilitating our ongoing strategy of developing unique products with multinational partners, enabling fast and extensive market penetration."
Martin Wright, Managing Director, Marine Current Turbines
“The UK wave and tidal energy sector has fantastic potential for creating skilled jobs and high-value exports for the UK. However, it requires a significant financial commitment and greater confidence to be shown by the private sector, as well as the right support mechanisms from Government to enable the UK marine energy industry to grow and prosper.
Marine Current Turbines has a world-leading and proven tidal energy technology and a pipeline of projects in the UK and North America ready to take forward over the next 5-10 years. If additional investment and a greater level of engagement from the UK’s industrial leaders is not forthcoming into the marine energy space, it will be inevitable that the UK will once again miss out and be left behind just as it happened with onshore wind power.”
SB Cha, Chief Executive, ACAL Energy
“2011 is a very important year for our commercialisation plans; we will be demonstrating the technical feasibility of our technology in highly competitive applications, to a globally receptive audience and would make significantly more value from this if our own government and home market were more visibly committed to a green economy
“We’re developing a technology that has the potential to give step change reductions in carbon emissions; the government need to step up quickly to ensure that the UK does not fall behind other countries in capturing the economic value from new low carbon technology such as ours”.
Simon Harvey, Managing Director, Benchmark
“There are two markets we are targeting. The first is corporate business and the public sector where sustainability is well established but the vast majority of organisations are still using spreadsheets to manage their data. There is a huge opportunity for software that will improve how sustainability data is managed and reported.
“The second is small and medium-sized businesses (SME’s). SME’s are the backbone of the UK economy and account for nearly half of the UK’s business carbon emissions.
“It is still early days but SME’s are becoming increasingly aware of their emissions and the business opportunities of reducing them. Whether it’s making them stand out from their competitors, saving money by being more efficient, or future statutory requirements, businesses that grasp the nettle now will give themselves a competitive advantage.
“We have been talking to our customers about carbon accounting for several years and opinion is definitely changing. Rising energy costs are obviously a part of this and I think will be the main driving force for most SME’s, but they are clearly aware of supply chain pressure and ‘green’ marketing opportunities. The Carbon Trust Standard is an ideal way to turn good intentions into real business benefits, and is a clear way of promoting their green credentials. This was certainly a reason behind us becoming certified.
“I have no doubt that Carbon accounting will become a statutory requirement for all businesses. The CRC is just the start. I saw achieving the Carbon Trust Standard as an absolutely critical way of making progress in these markets and to show we are serious.”
Notes to editors:
- A total of 707 online surveys were completed with Senior Decision makers from companies with at least 50 or more employees between 14 December 2010 – 4 January 2011
- 199 of these interviews were very senior decision makers with CXOs / Directors of companies with at least 1000 employees
- A full analysis of the data is available.