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How are Businesses Responding to Climate Change?: PwC’s Global CEO Survey Insights

PwC’s latest survey highlights the key challenges in corporate climate response.
17/01/24
TL;DR Embed
TL;DR: PwC's 27th Annual Global CEO Survey reveals a mixed approach to climate change among businesses. While two-thirds are working on improving energy efficiency, less than half are incorporating climate risk into financial planning, and nearly 40% overlook investing in nature-based solutions. The survey also points out that 30% of CEOs don't plan on upskilling their workforce for a net-zero economy. Challenges include sector-specific hurdles and operational constraints, but overcoming these obstacles through strategic planning and innovation presents significant opportunities for sustainable business transformation.

The 27th Annual Global CEO Survey by PwC, encompassing 4,702 CEOs across 105 countries, reveals significant insights into how businesses are responding to climate change. This article delves into these insights, highlighting the various strategies and initiatives that companies are undertaking, as well as the significant gaps and challenges that remain.

Two-thirds of CEOs have efforts underway to improve energy efficiency but only 10% report completing such initiatives

The survey reveals that a majority of CEOs are engaged in enhancing energy efficiency, with two-thirds actively working on such projects. However, only a small fraction, about 10%, have successfully completed these initiatives. This disparity indicates a widespread recognition of the importance of energy efficiency but also highlights the challenges in fully implementing these changes.

Fewer than half of all respondents have incorporated climate risk into financial planning—and nearly one-third have no plans to do so

Alarmingly, fewer than half of the CEOs surveyed have integrated climate risks into their financial planning. This oversight is critical, as it suggests a gap in acknowledging the long-term financial implications of climate change. Furthermore, approximately a third of the respondents do not intend to incorporate these risks, underscoring a potential blind spot in strategic planning.

Almost 40% don’t plan to invest in nature-based climate solutions

Despite the increasing awareness of the importance of nature-based solutions for climate mitigation (which involve using natural processes and ecosystems, like forests and wetlands, to reduce greenhouse gas emissions and adapt to climate change impacts), the survey indicates that nearly 40% of CEOs have no plans to invest in such initiatives. This reluctance overlooks the potential benefits these solutions offer, not just for the environment but also for their businesses, especially considering the dependency of global GDP on natural ecosystems.

30% don’t plan on upskilling their workforce

A concerning 30% of CEOs do not intend to focus on workforce upskilling in the context of a transition to a net-zero economy. This lack of commitment to workforce development could hinder the broader effort to ensure a just and inclusive transition, potentially leaving a significant portion of the workforce unprepared for the evolving job market in a greener economy.

Obstacles to change

The survey identifies a range of sector-specific obstacles to large-scale corporate change. Infrastructure challenges are particularly pronounced in sectors like energy, utilities, and transportation. Interestingly, issues such as lack of support from boards or internal stakeholders are not perceived as major constraints, indicating that the primary barriers are more operational and strategic in nature.

Overcoming obstacles

To address these challenges, it's essential for CEOs to focus on areas within their control. This includes streamlining bureaucratic processes, balancing operational priorities, allocating financial resources effectively, and enhancing workforce skills and technological capabilities. Importantly, CEOs should recognise the significant time inefficiency in meetings and administrative tasks, as identified in the survey. By reducing this 'sludge' tax, companies can free up resources and focus more on strategic initiatives, including those related to climate change.

Moreover, the survey suggests that CEOs are increasingly viewing climate change not just as a challenge, but as an opportunity for innovation and value creation. This mindset shift is crucial for overcoming obstacles and leveraging climate action as a catalyst for business transformation.

FutureTracker is the perfect partner for your sustainable business transformation. Our sustainability success system offers a well-rounded approach, combining expert-led project management with practical tools. Furthermore, our TCFD reporting tool specifically aids in integrating climate risks into financial planning, providing a strategic edge. This holistic system is designed to streamline your sustainability journey, making it more efficient and effective, and ensuring your business is well-equipped to meet the challenges of a greener future.

If you’d like to learn more about how FutureTracker can revolutionise your sustainability, book a demo here.

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