OliverWyman’s report on CDP data
– Large European companies are reducing greenhouse gas emissions, but only 1 in 5 is changing their green business model. More than half have plans for the ecological transition, but much less are acting concretely. This is stated in a report by OliverWyman on data from the Carbon Disclosure Project that analyzes 1,600 European companies, equal to 89% of the capitalisation of the continent.
“While the data shows the progress made by companies in reducing emissions over the last four years, on the other hand they also reveal the substantial limitations that still exist in the implementation of the key aspects of the transition plans and in determining a real change in business models“, the report stresses. Criteria include capital investment, new product development and supply chain management.
Who takes the green business model seriously?
At European level, “substantial” progress is recorded in only 21% of European companies, while 27% have only “partial” results and more than half (52%) do even worse, with “limited” commitments in the implementation of green business model. Italy is slightly below the EU average, with 20%, 21% and 60% respectively.
Among the most reluctant sectors to transform their business model are food, drink and tobacco, agricultural products and metals, all with over 45% of companies showing limited progress. The most virtuous are those of electricity generation, where 63% of companies have achieved substantial results, and the steel sector where the percentage reaches 60%.
A close look at electricity, steel and cars
Even for the sectors with the best score, however, there are critical issues. The report examines mainly electrical services, steel and automotive, three of the main European polluters. “The good news is that they are already investing more than others in the transition, with over 50% of the capex going to ecological initiatives“. But there are rocks on the horizon.
By 2030, electricity companies could find a gap of 285 billion euros compared to the investment in capital expenditure required in renewable energy and the expansion of the network to encourage electrification and decarbonisation of transport and heavy industry.
For steel, 87% of steel companies today offer certain types of low-carbon products, but revenues in this segment represent only 22% of the total. “As a result, green steel production is expected to fall to 18 million tonnes, or 31%, below demand by 2035,” the report warns.
On the automotive side, more than 90% of the carbon footprint of the sector is within Scope 3, that is the emissions generated by the supply chain and the use of cars. Yet only 11% of companies ensure that at least ¼ of their suppliers meet climate requirements.
