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Autumn/Winter 2021 47 “The greenwashing of some firms is surely over. That’s clear from the new accountability regimes in place. But it’s also clear in the record CEO attendance at COP. Companies don’t send their bosses to secure reputations. They send their bosses to take action.” ON THE ROLE OF GOVERNMENTS Tony believes that political leaders everywhere are starting to say that the role of governments on climate change is limited in scale and scope and that it is the ingenuity and financial might of the private sector that is required to get the world to Net Zero. “We accept the challenge. We can make greater commitments, accept deeper accountability, and raise more capital for the task. But political leaders need to now get serious about what it will take to make this successful, and successful for every sector. Governments nationally must design the markets correctly to let that capital be deployed. And governments internationally must agree consistent commitments and standards to ensure that companies can move fast and green innovations can travel across borders. “Governments are used to being only the green rule-makers. Now they must learn to also become green market-makers. They can pump prime nascent markets such hydrogen and battery cell production to make them grow. They can design market mechanisms that guarantee investible propositions with returns such as contracts for difference in offshore wind. They can rebalance economic regulation to give investment and innovation equal status. They can use taxation to incentivise those who make green choices and penalise those who don’t. “Those that aren’t proactive in stimulating markets to flourish are willing the ends of investment in net zero but ignoring the means.” THE UK’S JOURNEY TO NET ZERO Post Brexit, and post COVID-19 fallout, decarbonisation should be our next big focus, Tony states. “It is already driving a rebirth of innovation. It is bringing substance to the levelling up agenda – by bringing higher value industries and jobs to different corners of our country- and it gives definition to the idea of Global Britain because it is the source of newproducts and services where we can lead the world,” he said. “This can be a UK success story. Our climate politics are unique. Climate is not a right v left issue here, unlike many parts of the world. Our business mindset is far more advanced on net zero than in most other markets. “And we are not only competing at the frontier – with new technologies and inventions. Our work on the transition to net zero – the hardest bit of all – is already underway. “Every sector in our economy is grappling now with the real consequences of what decarbonisation does to our business models, our customer propositions, and our economics. I am convinced that the pain of doing this faster than others will bring us even greater opportunities on the other side. “That is why we at the CBI have put decarbonisation at the heart of our economic vision for the UK. Why we are working tirelessly with the UK Government on how to ensure climate change policy unlocks green investment – nationally and globally. “It’s why we’ve been working with other international business organisations and business leaders too – to drive collaboration and action now, whatever our political leaders agree. The CBI will regard it as mission critical to enable every firm in the UK to complete its successful net zero transition.” << that no-one had expected or even dreamed of. Unfortunately, it also harmed our planet, in some ways irrevocably, along the way. “But more prosaically, this is also a commercial imperative. As policy and market demands shift, we must transform our supply chains just to keep up. Our customers, clients, investors and shareholders expect nothing less.” As boardrooms around the world run the numbers, they are realising that the business case has shifted, Tony said, adding that in purely commercial terms, the cost of inaction is, for the first time, higher than the cost of action. “Every business has faced strategic challenges of this kind before. When the future attacks the present, the answer is never to protect the present. It is always to run to the future,” he said. “Yet there is an emerging gap now between firms who want to be at the forefront of the net zero transition and those who are resisting the inevitable. It’s time for firms to choose – either lead the way or be left behind.” “Those that aren’t proactive in stimulating markets to flourish are willing the ends of investment in net zero but ignoring the means.”