KIGALI, Rwanda, Jan. 31, 2024 – Small and medium-sized business (SMB) leaders are increasingly playing a critical role in tackling climate change, but nearly all do not measure their company’s environmental and energy performance. As environmental regulatory requirements intensify, this lack of measurement is a significant barrier to SMBs’ contributions to sustainable practices. Recent research by YPO, a global leadership community of chief executives, highlights a need for SMBs to better understand and disclose their environmental impact. In its inaugural Global Impact Report, only 4% of YPO members surveyed were able to provide data on their companies’ direct and indirect emissions (scope 1-3); similarly, only 5% of chief executives surveyed measure the level of their businesses’ renewable energy use.
Lack of data on environmental and energy performance poses a significant challenge to SMBs’ ability to meaningfully contribute to the energy transition and mitigate climate change. In addition to the lack of measurement, the report identified that less than a third (28%) of business leaders have a social and environmental committee on their board of directors. An even fewer percentage, 27%, reported having a full-time sustainability leadership position within their company. As environmental measurement and reporting requirements become increasingly important, these findings underscore a growing need for upskilling SMB leaders to measure and report on environmental impact.
YPO Global Chairman, Raymond Watts, emphasized the importance of addressing these challenges, saying, “Our members are at the core of many economies around the world and want to play their part in tackling the environmental emergency, but currently, the majority simply don’t have the data and support to do so. This inaugural report provides an essential baseline for YPO member businesses to begin benchmarking their environmental impact and to make a positive difference. We are committed to supporting them to effectively measure their energy use and carbon emissions, including exploring technological data and reporting solutions.”
In addition to the obstacles posed by lack of measurement, YPO reports that environmental reporting is essential to business success. Regulatory pressure to disclose environmental data is intensifying, highlighting the need for businesses to demonstrate their commitment to sustainability and a low-carbon economy. Furthermore, the Corporate Sustainability Reporting Directive (CSRD) compels businesses with a presence in Europe to start disclosing their environmental impact. In the United States, the Securities and Exchange Commission is also expected to adopt climate disclosure rules. SMB leaders must evaluate these challenges and opportunities for their businesses and stakeholders in order to execute a targeted strategy for improvement.
YPO is a global leadership community with a mission to connect chief executives who believe that the world needs better leaders and that business can be a driving force for good. With more than 35,000 chief executives in 150 countries, YPO members lead organizations that collectively employ over 22 million people and generate over USD9 trillion in combined revenue. The YPO 2023 Global Impact Survey was conducted by YPO in partnership with EY, and it aimed to capture diverse perspectives from business leaders regarding their social and governance impact. The survey collected responses from over 700 YPO members from 82 countries and covered the reporting period from January 1 to June 30, 2023. For more information, visit ypo.org.
Media Contact:
YPO
Global Marketing & Communications
mediarelations@ypo.org
Source link
