Most businesses are unaware and unprepared for the impending green transformation

The European Green Deal is poised to transform the business landscape from tax and procurement to supply chain management, but less than half of businesses know what it is and most are unprepared , according to a survey by professional services firm PwC.

The survey of 300 companies in 13 European countries found that only 40% were aware of the bloc’s overall plan to achieve net zero carbon emissions by 2050, while only 49% considered their organization was prepared for the “extended new requirements” involved.

“Companies will need comprehensive, long-term transformation efforts to respond, including identifying and capturing reliable data to support reporting,” the survey says.

PwC found that while the majority of companies are taking steps to become more sustainable – for example, two-thirds have already earmarked capital to invest in becoming more sustainable over the next three to five years – the investment was made on a ad hoc basis. rather than as part of an integrated plan.

The survey revealed that a significant number of companies were making sustainable improvements to buildings, equipment and manufacturing processes. This includes 70% of companies using clean energy “at scale” to power their operations.

Additionally, nearly half of respondents said their company was actively working to reduce its carbon footprint, and a third said they offset their carbon emissions through sustainability initiatives.

The EU plan includes more than 1,000 new taxes and related measures designed to fund it and encourage climate action.

The PwC survey unsurprisingly found that large companies with dedicated tax and finance teams and well-resourced research and development (R&D) and sustainability departments feel better informed and prepared for the challenges ahead.

Imports

He suggested that the provision with the greatest potential impact was the proposed Carbon Border Adjustment Mechanism (CBAM), which will apply to certain carbon-intensive imports.

Under the proposed CBAM, EU importers would essentially buy carbon certificates for the carbon price that would have been paid if the goods had been produced under EU carbon pricing rules.

David McGee of PwC Ireland said: “The lack of familiarity with the Green Deal in our survey reflects the fact that a majority of companies are not fully prepared and coordinated within their business to most effectively adapt to the upcoming changes.

“Most companies that take action on sustainability initiatives do so in a piecemeal fashion. In Ireland, based on our experience with clients, we see the same lack of knowledge and preparation for the European Green Deal. »

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