Beyond the numbers with Grant Thornton: Listen now
As this landscape shifts, family businesses must become aware of their carbon emissions and develop a proactive carbon reduction strategy, whether it be aiming for net zero or another reduction target.
Family businesses are connected to their communities and play a unique role within the sustainability landscape. While large businesses may be required to mandatorily disclose their carbon emissions, those family businesses that won’t need to report can voluntarily adopt carbon reduction measures to demonstrate their commitment to sustainable practices. By leading the charge in sustainability and being proactive, family businesses can potentially create positive opportunities with their customers, partners and communities.
Our recent Family Business Survey data highlighted at least 50 per cent of respondents from the Arts and Recreation Services, Energy and Resources, Life Sciences and Technology, Media and Telecommunications industries had a carbon neutral or net zero strategy high on their list as important, while others were not considering this at all.
This was a similar outcome when looking at businesses who were undertaking carbon tracking as well as forecasting, where again, the Arts and Recreation and Energy and Resources industries scored the highest, while most other industries did not deem this as important.
Even if a family business doesn’t need to comply with mandatory reporting, it is crucial to recognise evolving customer expectations. The clients or customers of family businesses may require them to report their Scope 3 emissions — the indirect emissions associated with their value chain because they could begin to turn away from brands who cannot prove their eco footprint.
As a result, they will need to seek out suppliers and partners who actively contribute to reducing these emissions. By embracing a carbon reduction strategy, family businesses can position themselves as leaders, meeting the expectations of environmentally conscious customers. We are already seeing this occur where large businesses are demanding more from their supply chains, ruling out suppliers who do not help meet their targets.
As the business landscape adapts to environmental imperatives, family businesses have an opportunity to evolve. Many corporations are prioritising sustainable practices in their procurement decisions, so by highlighting your commitment to carbon reduction, you not only demonstrate forward-thinking but also enhance your chances of securing valuable partnerships.
In addition, taking the steps to create a carbon reduction strategy is a an opportunity for family businesses to innovate and optimise their operations. By re-evaluating processes and supply chains, family businesses can identify inefficiencies, reduce waste, and enhance overall operational sustainability.
The benefits extend beyond environmental impact – such innovations can lead to long-term cost savings and increased profitability. Embracing carbon reduction strategies can serve as a catalyst for broader business optimisation and the creation of a long-term sustainable business that may be passed on from generation to generation.
A strong carbon reduction strategy should integrate into your overall vision for the family business. Start by assessing your current carbon footprint, identifying areas for improvement, and setting realistic reduction targets. Collaborate with stakeholders, engage employees, and leverage their insights to explore opportunities for process optimisation, energy efficiency, and sustainable sourcing. Regularly monitor and communicate your progress to key stakeholders in order to build trust.
As a family business it is time to proactively address your carbon emissions position, well ahead of when you may be required to report. Reach out to one of our Environmental, Social and Governance or Family Business Partner leads to discuss how you might go about obtaining a baseline calculation and develop a carbon reduction strategy that will set you up to report and create a long-term, sustainable business.
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