Some 80 per cent of Irish companies do not believe they will meet their carbon neutral targets in 2030, according to a new survey by professional services firm EY.
The dismal finding comes as many western countries drift back towards fossil fuels in response to the current energy crisis and the potential threat to energy security.
EY's "state of sustainability" report suggests that four out of five firms in Ireland had "low confidence" in meeting carbon neutral targets in 2030, up from 66 per cent last year.
Despite this, firms were found to have increased awareness of sustainability considerations and implications they had for the business.
"As organisations look more closely at their carbon ambitions, they've gained a deeper awareness of the various challenges the transformation will introduce," head of sustainability at EY Ireland Stephen Prendiville said.
“ With this understanding, Irish business leaders are also experiencing a greater sense of concern around the achievement of stated goals,” he said.
“ Business leaders are also facing headwinds amidst the ongoing energy and inflation crisis and challenging geopolitical issues,” Mr Prendiville said.
“These factors, combined with less time to achieve the 2030 goals, mean that we are seeing lower confidence reported,” he said.
The current energy crisis – aggravated by Russia's war in Ukraine – underscores the need to move away from fossil fuel dependency, particularly in Europe, while at the same time highlighting the global economy's stubborn reliance on fossil fuels.
EY’s survey, carried out earlier this month and based on what it said was a representative sample of businesses with 50 or more employees, also highlighted the key motivations behind sustainability-related actions, which included compliance (returned by 28 per cent of respondents, up from 16 per cent last year) and doing good for the environment (25 per cent, up from 22 per cent).
Some 40 per cent of respondents agreed their company’s sustainability efforts to date have positively impacted the bottom line, down slightly from 44 per cent in 2021.
While most firms said they could see the potential positive impacts of driving towards their sustainability goals, just 36 per cent said their organisation were experiencing opportunities for value generation from sustainability, ESG (environmental, social and governance) or net zero strategies.
With compliance now the dominant driver of sustainability efforts, this focus would appear to be at the expense of any value-based opportunity, EY noted.
“The biggest concern in the results is the predominant sense among Irish businesses that they are not doing enough when it comes to sustainability. Simply put, we need to do more,” Mr Prendiville said.
“Decarbonisation requires a huge transformation effort and is a significant challenge for some organisations, but it is also a major opportunity,” he said.
