Market research agency The Reality Department’s study of 500 decision-makers found that net zero commitment is strong in many companies, but funding is not.
-- The Reality Department, a leading market research agency, recently commissioned a study of more than 500 sustainability decision-makers across various firms in the United States and the United Kingdom holding a formal net-zero target. The research found that only 3% have the capital government's emissions data in place to deliver on their plans, underscoring the reality of ideological but not financial alignment.
The study, entitled "The Climate Commitment Gap: Wave 1," covered over 500 sustainability decision-makers, split evenly between the two markets. 94% sit in a dedicated sustainability role, with the remainder being C-suite executives with sustainability authority over their companies.
The study tracked what happens at each stage, from when a firm states a commitment to net zero to when it later provides resources for it. 55% of organisations have a formal net-zero target, and 35% have made that target public with a date attached. However, only 15% will direct more than 5% of their capital expenditure toward it, and only 3% have a board-approved transition plan and comprehensive Scope 3 measurement. Unfortunately, two in five companies with a public target put less than 5% of their capital expenditure behind achieving it.
The Reality Department's research identifies two types of companies occupying the space that are difficult for regular market observers to identify from the outside:
- Declarers: 28% of the market, and they advertise public targets 53%.
- Integrators: 27% of the market, and they announce public targets at 58%.
Behind these announcements, they diverge sharply. Only 21% of declarers spend 5% or more of their CAPEX on public targets, while 76% of integrators do so. Meanwhile, 40% of declarers have no climate governance structure, compared to just 2% of integrators.
When companies were asked to name the biggest obstacles to meeting their commitments, they pointed to competing capital demands, lack of data quality and budget issues. Executives working in these firms often approve plans, but few are funded.
A spokesperson for the reality department said the following:
“The gap between stated intentions and funding for sustainability projects and net zero is remarkable in the companies surveyed, and it's an issue for investors looking for ESG opportunities.”
For more information about The Reality Department, use the contact details below:
Contact Info:
Name: Jake Pryszlak (founder)
Email: Send Email
Organization: The Reality Department
Phone: 07545 566276
Website: https://www.realitydepartment.co.uk/
Release ID: 89201932
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