This is a guest post by Rhian Kelly, Director of Business Environment at business lobby group CBI.
It’s been four years since the CBI created our Climate Change Board and one of the biggest changes has been that the corporate world has come to see tackling emissions as a business opportunity. According to the last FTSE 350 carbon disclosure report, 79% of companies see a significant risk from a changed climate, but, interestingly, 83% see at least one significant opportunity.
That for me seems the major difference between how our members and their customers perceive climate change. British businesses understand the low-carbon transition as a chance to save and make money, but the majority of consumers just see it as an additional cost.
That’s because it’s easier for businesses – their boards get handy spreadsheets that make clear the benefits. When you’re told how the global green economy is worth £3.2 trillion the choice becomes easier. But the truth is that business has yet to make a compelling enough case to their customers about the benefits of the low-carbon economy.
Making this case is vital when about 60 per cent of the UK’s emissions are under the control or influence of consumers. The new ideas being rolled out by innovative businesses will only succeed if we want to use them when we go home. If we don’t, then business won’t invest in low-carbon innovation and this will make it much harder to hit our legally binding emissions targets.
That is why last year we worked with Ipsos MORI to find out exactly what we are doing wrong. The report that resulted Buying into it: making the consumer case for low-carbon, published last month, showed just how uninspired the public are.
We asked almost 2,000 people their thoughts on these issues. Then a number of smaller focus groups were put together to think some of the issues through in detail. We wanted to know why this market, which has such huge potential, wasn’t the size it should be. And the answer was – we’re talking the wrong language.
We found a breakdown in communication where most people don’t see a connection between a global environmental problem and their weekly shop. In the supermarket, most shoppers don’t want to know how something is contributing to our global emissions but how it can save them money.
Some businesses really get this. Michelin don’t sell green tyres by saying how much CO2 they save. They talk about how one tank of petrol in every five is spent on a tyre’s roll resistance. When Toyota sell their Prius, they don’t sell a good conscience but a good product.
But if we’re going to get across the benefits then we need to give clear, consistent information to the consumer. We’ve seen how it works with white goods and the success of A-G labelling from the early 1990s.
This goes to basic behavioural change models. If we want to make lasting change then we mustn’t patronise, we mustn’t force, but instead we must positively engage with consumers, nudging them along.
So we need to persuade by showing the information. But where does this information come from? Our data shows that 83 per cent of the public think businesses have a responsibility to tell their customers about energy efficiency. But only 16 per cent trust manufacturers to be truthful about it. That needs to change.
We need to work across different industries on universal standards. Business will need to make sure their floor staff understand and are able to give the consumer their knowledge. We’ll need to harness the latest technology like smart meters, or using our mobile phones as barcode readers to bring up the practical energy use of a product.
And we need the government working with us as well, to ensure we are all singing from the same hymn book. The report is just the start of the work for us – it showed the problem and how to resolve it. Now it is up to British business to make it happen.
