Why a successful energy strategy calls for a board-level commitment
The New York skyline was turned green last week, in honour of the 10th annual Climate Week NYC, which saw international leaders from across business, government and industry, coming together to accelerate climate action.
A series of talks and more than 100 affiliate events were held across the city, with expert speakers from a range of disciplines offering advice and insights – including Anesco executive chairman, Steve Shine, who joined an expert panel discussing how businesses might transition towards 100% renewable energy.
One key topic to grab the headlines was the news that RE100 companies - a group of organisations who have all made a public commitment to go ‘100% renewable’ – are outperforming their peers.
When the financial performance of the companies in the RE100 was compared to 3000 of their rivals, the RE100 consistently scored higher across all sectors. This included the areas of net profit margins and earnings before interests and taxes (EBIT), with the difference ranging from 0.3 to more than seven percentage points.
With seven more companies joining the likes of Sony, Ikea, Aviva, Coca-Cola, Microsoft and Tesco in signing up to RE100, and more and more organisations looking to follow in their footsteps, energy efficiency and investment in renewable technologies remains high on the corporate agenda. But according to Steve Shine, what many businesses fail to recognise is the need for such changes to be driven from a board level.
“It’s fantastic to see so many top brands leading the way and making a public commitment to positive environmental practices, but they’re not the only ones - the opportunity is there for businesses of any size and industry” commented Steve.
“One issue we often encounter in our work with commercial and industrial organisations, is that responsibility for energy management and energy efficiency is laid at the door of lower level managers, who are just left to get on with it. However, this can be a mistake.
“Taking strategic action in these areas has the potential to transform the performance of a business across many levels, including as we’ve seen in the recent RE100 report, boosting profitability and competitive edge. It therefore warrants the time and attention of the senior team, who should view it as a strategic operational investment that demands a commitment from a board level if it’s to achieve its full potential.”
Reducing waste and generating power onsite can reduce operational costs, while offering protection and stability in the face of spiralling energy prices. Technologies such as solar and energy storage can also open the door to new revenue streams. Alongside this, being shown to be an environmentally-responsible company can help boost reputation, recruitment and retention.
Steve continued: “For any corporate, making the transition to 100% renewable is a complex road to navigate. To be successful in the long term, it’s vital that teams have the right support in place. It calls for a big picture view and detailed knowledge of both the evolving political and technological landscape, to ensure that the greatest return on investment is achieved. The opportunity is there, firms just need to step up and start reaping the benefits.”