Mumbai (India CSR): At the United Nation’s 26th Conference of Parties (COP26), India committed to further boost the green wave in the country, pushing organizations for emissions reduction. It was in this context that the Boston Consulting Group (BCG) conducted a survey to evaluate the readiness of Indian organizations toward the climate change guidelines of COP26.
The survey findings form BCG’s latest report titled, “Report on Readiness of Indian Industries towards Climate Change Guidelines of COP26”. Launched today on Earth Day, the report is a timely study about the impact of climate change on Indian industry and businesses and the very crucial role they can play to safeguard the planet.
The survey was carried out with CXOs and sustainability leaders across nine industries and highlights the sentiments of these organizations regarding the achievability of COP26 goals. According to the survey findings, 71% of the respondents feel that India’s COP26 goals are achievable with an encouraging regulatory framework with aspects such as incentives for low carbon technologies, and carbon-pricing mechanisms. Most respondents from the cement, metals, and power and utilities industries were highly confident in achieving the sustainability goals.
The report highlights that organizations are adopting sustainable business practices for select reasons including brand image, growth, and pressure from investors and stakeholders like rating agencies, customers, employees and so on. About 51% of the organisations ranked pressure from stakeholders as one of their top reasons to invest in sustainability initiatives, especially those focusing on ESG-based (environmental, social, and governance) considerations.
Organizations across industries have also been found to have a considerable understanding of sustainability and climate goals and are increasingly incorporating ESG considerations into their business decisions.
- Talking about the immediate goals of the organizations, 44% of the organizations aim to comply with regulations and become a leader in sustainability.
- On average, 45% of the organizations are clear on their emission reduction targets and are measuring their scope 1 and 2 emissions.
- 60% of the organizations in the cement industry have finalized their net-zero target timeline and have set their periodic emission reduction targets.
The growing trend of shifting towards a sustainable lifestyle is also widening the opportunity window for all businesses. About 55% of the respondents suggested that their customers are willing to pay a premium for sustainable alternatives. However, they highlighted concerns regarding standardization on quality and performance aspects.
Anirban Mukherjee, Managing Director and Partner, BCG India, said, “When it comes to implementing and achieving the sustainability goals, a significant share of the organizations reportedly face steep challenges. These include technological challenges like ESG data-related issues such as real time data integration, regulatory challenges like lack of standard regulations, and financial challenges such as the high cost of installing new technologies and building a competitive cost. Only when these roadblocks are resolved through regulatory norms and innovative at scale solutions, can organizations truly implement their sustainability efforts to bring about a change.”
Businesses in India need to align their operations and production processes with standard sustainability norms and practices. At the initial stage, all industries should prioritize setting up their sustainability goals and identification of unique KPIs for monitoring and assessing their progress.
All businesses must start thinking ‘dynamically’ in order to be able find the right balance between market interest and the final product.
