If I asked you: “Can I help you add 10-20% to your bottom line?” You’d probably be very interested to hear what I had to say.
BUT:
If I asked you: “Can I help you with your Sustainability and ESG programme?” You’d probably say “Maybe next year.”
You might even add a qualifier like; the regulations don’t affect us or there are too many other pressures and things on the go at the moment.
You might even roll your eyes and tell me: “It doesn’t apply to us.”
However, would you change your opinion if you heard some statistics:
Economic benefits:
According to KPMG, the green economy is growing 3 times faster than the rest of the economy creating over 400,000 green jobs last year alone.
A study by Deloitte put the global opportunity of the move to net-zero at $48 trillion whilst the cost of inaction to correct or adapt at $173 trillion over the next 50 years.
McKinsey identified that a similar proportion of companies experienced an increase in ROI as a result of having a net-zero target.
Bottom-line benefits:
The net-zero census identified that 67% of companies that have a Net-Zero target see an increase in revenue of between 3 - 10%
In their net zero 2025 report the British Business Bank identified 50% of medium-sized businesses achieved efficiencies, cost savings, attracted new customers and retained existing customers as a direct result of having a net-zero target and transition plan.
30% of companies stated that having a net-zero target benefited recruitment and staff retention - reducing recruitment costs significantly.
PWC identified that exhibit a purpose-driven culture attract the best staff, ensures people feel valued resulting in 1.4 times more engaged and productivity staff.
For accountants and advisors offering their clients ESG and Sustainability advice represents a new service line and can generate significant revues, avoids reputational loss and builds resilience for clients.
Wider stakeholder benefits:
Increased temperatures, fires, floods and other extreme weather events are becoming more common every year and, as one commentator put it: “The weather used to be the bit at the end of the news, now it IS the news!” Building resilience has become key for a range of corporate stakeholders
Displaying your ESG credentials especially inclusion of climate risk in your risk management makes you more attractive to investors, financiers, insurers (see above) and build supply chain resilience.
Many supply chains now require ESG or Social Value (TOMS) credentials for inclusion in projects and / or tenders. NHS, central and local government other big companies
Mitigating risks and showing an increase in the “insurability” of assets increases their value in the balance sheet with a reduction in provisions - high end hotel chain coral and mangroves
S172 - can you sign this off if you aren’t considering extreme weather or flooding
Going concern - can auditors confidently sign this off if you (and they) haven’t considered the effects of weather events on your business
Conclusion:
Having seen the evidence, can you still maintain that ESG is purely a cost centre with no benefit and unless our customers demand it, it remains largely irrelevant to our organisation.
I would say that a company should focus on its 2030 net target but more on what it is practically doing to remain in business until 2030 alongside its competitors.
If this makes sense, please contact us, we’re always happy to chat.
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