Chief financial officers (CFOs) say sustainability is now a key part of their role and it is an important driver of business growth.
New research finds that over half of UK CFOs surveyed believe sustainability is very important to their role while 44 per cent see the finance department as the most important business function in driving sustainability.
The research also finds that overhead costs, financial risk and complex renewable technologies are the main barriers to sustainability investment with the top reasons for delayed decisions being lack of cost-effective renewables; shortage in investment grade cost analytics and limited access to expert partners.
The research, commissioned by energy procurement specialist Open Energy Market, captures the perspectives, opportunities and challenges facing 150 CFOs in driving sustainability initiatives across the UK and found that the majority of CFOs (85 per cent) believe achieving net zero is important to business growth.
Businesses are increasingly recognising the importance of sustainability yet are challenged with accurately measuring financial impact in a volatile energy market.
The finance department is endorsed by 44 per cent of CFOs as the most important business function in driving sustainability. This perspective is more pronounced amongst larger companies, with more CFOs (37 per cent) at these businesses saying facilitating the transition to net zero is one of their key priorities over the next twelve months, compared to the country average (26 per cent).
Almost half of CFOs say there is room to improve the alignment between procurement and sustainability teams, which suggests business cases for renewable investment require financial grade insights and a more cohesive approach to better engage finance teams.
“It’s encouraging to see the strong commitment of CFOs to prioritise the transition and make a difference,” Chris Maclean, CEO, Open Energy Market, said. “If we’re to make these ambitions accessible to all organisations, a huge amount needs to be done to ensure that sustainability project proposals are based on accurate insights, robust modelling and a deep understanding of market volatility.”
CFOs face multiple complex considerations when it comes to green energy initiatives with the main reasons for delay being: the lack of cost-effective solutions to support implementation of renewables (40 per cent), a lack of technologies that offer investment grade cost-benefit analytics of the business’s energy mix (37 per cent), followed by limited access to expert partners and advisors to support the implementation of renewables (28 per cent).
“As we collectively work towards net zero goals, having up-to-the-minute data and insights on a business’s true energy costs and net zero strategies can unlock the path to a more sustainable future, faster,” Maclean added. “True integrates these elements into one convenient platform, so changemakers can have the confidence and conviction to drive real, positive and sustainable change.”
The Open Energy Market research coincides with the launch of the company’s first-of-its-kind net zero platform – True. True unites an organisation’s real energy procurement costs and net zero strategies in one platform, enabling teams across sustainability, procurement, operations and finance to building stronger financial-grade businesses that accurately demonstrate the viability, ROI and impact of renewable investment.
True provides a foundation of accurate data and insights for stronger sustainability business cases and effective carbon-neutral strategies. Replacing inaccurate conjecture and static spreadsheet modelling, the platform uses holistic, dynamic and bespoke financial modelling. This breakthrough from Open Energy Market builds confidence in decision making, accelerates action and is poised to expedite the journey to net zero.