Member Article

Avoiding the zero sum game

With COP26 an increasingly distant memory, businesses must tread more carefully in their responses to climate change to avoid the zero-sum game.

As the government’s climate change agenda falls victim to the crisis in energy affordability and security, businesses must review how they plan to deliver on their net zero pledges without alienating hard-pressed customers.

This isn’t about questioning whether climate change is important and must be addressed – on that there is broad agreement. Likewise, the public expects business to be at the forefront of the transition to a greener economy. The question is instead whether climate change is urgent when considered alongside other competing priorities, and what the real impact of net zero policies will be on customers who are being squeezed on all sides.

It’s in this context that we see the apparent consensus on climate change begin to unwind, turning what might seem an obvious reputation and commercial opportunity into an issue fraught with risk.

Understanding this picture requires us to look at the deeper societal divides that define the debate. On the one hand are younger, cosmopolitan graduates for whom action on climate change is an imperative and who will actively seek to hold businesses to account. On the other are older, more culturally conservative and often less well-off town-dwellers suspicious that they will foot the bill for a net zero agenda which may appear to offer little by way of tangible benefit to their lives.

This division is likely to be exacerbated by a rapidly changing economic context. As inflation takes hold, the demands for government and business alike to focus less on net zero policy and more on ‘the basics’ of customer service and value for money will grow ever louder. And these demands will be fiercely resisted by implacable advocates of climate action.

The political energy this creates will attract growing attention. Net zero scepticism is more prevalent among that part of the electorate – older people in post-industrial communities – whose votes this Conservative government sought and won, often for the first time, to achieve its parliamentary majority. These are votes that the Labour party must look to win back at the next election, and they also constitute the target audience for Nigel Farage’s new campaign for a net zero referendum.

All this presents a significant challenge for businesses. How do you navigate this changed political landscape? How do you serve customers with conflicting points of view while continuing to grow as a commercial enterprise and transform the operations of your business to meet climate targets? And how do you achieve all this in the face of deep mistrust of big business and the claims it’s making on sustainability?

The answer lies in developing an agenda that neutralises the potential trade-off between climate action and delivering value for customers. Businesses must establish a deep understanding of their customers, their needs and how these interact with their broader social attitudes to find the common ground between different sides of the debate. This insight can then be used to create strategies that align sustainability with the purpose, values and activities of the business – both inside and out. David Rowson

This was posted in Bdaily's Members' News section by Yonder .