Climate change will be the challenge of our generation. To transition our economy, based around fossil fuels and carbon since the Industrial Revolution, presents a staggering test of resolve for both industry and wider society.
The effects of climate change are often less visible than other environmental impacts, but will be experienced most keenly by future generations without dramatic societal changes to slow global temperature rises. A multi-faceted approach by industry, investors and governments is required, and businesses should be looking to move beyond good intentions and start to achieve real results.
The economy’s focus is shifting to sustainable models across the board: renewable energy will replace fossil fuels, electric vehicles will eventually overtake petrol and diesel cars, air and ground heat will replace gas boilers. Businesses face risks, directly from failure to adapt and indirectly from changing customer and consumer appetites, but the opportunities for sustainable businesses should not be overlooked.
As governments set ambitious climate targets, we anticipate a move from the current transparency and reporting regimes to more demanding statutory restrictions and obligations. Current and proposed carbon and energy efficiency reporting and transparency regimes are likely to increase in scope and gain additional regulatory teeth. Ultimately, traditional businesses will need to pivot to more sustainable activities, and innovative solutions will play a key role in this transition.