Fewer than one in five of the UK’s biggest public companies have credible plans to slash their emissions to net zero, research suggests.
To bring businesses in line with the UK’s ambitions, large companies must be compelled to disclose their transition plans for how they will get to net zero a letter to ministers, signed by more than 30 organisations, said.
The Government should clearly lay out when it intends to do this by, the letter, addressed to Chancellor Rishi Sunak and other officials, says.
The UK was the first major economy to set a net zero ambition in law in 2019, but risks falling behind if it does not move forward with further plans.
“In other jurisdictions, the European Union, seeking to build its green finance credentials, has announced an intent to require transition plans from all large companies, including short term targets and reports on progress,” the letter reads
“The UK, however, can consolidate its green finance competitiveness and climate leadership by being the decisive first-mover in setting global norms for transition plans.”
The signatories include B&Q owner Kingfisher, outsourcer Mitie, energy company E.On UK, as well as financial institutions that oversee assets worth £4.5 trillion.
They included Aviva, Legal & General Investment Management and Santander.
The Association of British Insurers and the Aldersgate Group, a business group, also put their names to the letter.
Legal & General Investment Management chief executive Michelle Scrimgeour said: “We need to see substantial change across economies and society globally to achieve this goal.
“While there is clear progress in many areas of industry, it will not be enough and we are supportive of the Government in its aim to raise standards across the entire market.”
Earlier this year laws were put in place which make it mandatory for large businesses to publish climate-related financial disclosures.
“We therefore see mandatory net zero transition plans as the natural next step to climate-related financial disclosures and one which is essential to drive good business and investment decisions and promote a level playing field,” said Nick Molho, executive director at the Aldersgate Group.
“The plans will ensure that all corporates and financial institutions have a strategy in place to decarbonise their supply chains and assets and address climate risks.
“Introducing such a requirement will ensure businesses operating in the UK are equipped to support the delivery of the country’s net zero target and the goals of the Paris Agreement and will put the UK economy at the forefront of the global shift towards net zero emissions.”