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The ESG Review: UK net zero retreat sparks backlash

There are no prizes for guessing which story has dominated headlines around the climate crisis in the UK this week.

The news from the Government that it will soften several key policy commitments which are mainstays in the drive to achieve net zero emissions by 2050 has been grabbed and assessed from all angles by journalists. The signs are that it will continue to make headlines in coming weeks and months.

It’s a move that has of course thrown public commitments into question, and thrown more fuel onto the increasingly fiery debate about how practical and pragmatic the phase-out of key fossil fuel-burning technologies are by deadlines that are very much looming on the horizon. These are principally the intended ban on sales of new petrol and diesel cars from 2030 along with that on the installation of gas boilers in new homes from 2026.

But it has already begun to create a backlash from businesses, both because of the uncertainty and likely disruption to their own transformations to meet the regulations, and likely also because they have made their own commitments to cutting emissions and other fundamental changes.

For companies with primary ESG goals in parallel to the policies, it throws much of the past years of political direction up in the air. Ford’s statement pulled no punches: “Our business needs three things from the UK government, ambition, commitment, and consistency... A relaxation of 2030 would undermine all three."

In its initial piece, Rishi Sunak dilutes net zero, The Spectator surmised that “However, Downing Street is braced for a row – the sense is that the so-called Westminster bubble could take against the proposals, but voters could be more sympathetic.”

The point being that while the politicians may do the loudest shouting to decry the move, many voters may actually be in favour of the softening during a cost-of-living crisis, particularly in constituencies over-indexing with people cynical about the net zero agenda, or wanting to preserve the status quo for their own ends. The BBC outlined the PM’s gamble with the electorate and MP Caroline Lucas wrote in The Guardian that he had united Greens and the car industry against him.

Yet in the build-up to this week, we’ve seen a steady stream of editorial questioning the political logic of a climb-down to appease those more cynical voters, anchored on the Uxbridge by-election result’s ULEZ factor. Politico wrote just a month ago that Tory voters overwhelmingly back the 2050 net zero targets, which at that point were wrapped up with the car, boiler and other policies now seemingly under review.

Another Spectator piece speculated that the petrol and diesel car ban and one on oil boilers would be changed to 2035 - and also pointed out that if the PM aims to balance that news with remaining committed to net zero by 2050, the former would hugely undermine the latter.

The Guardian billed the move as a pre-election challenge to Labour, and covered staunch opposition from members of all the main parties. We can expect much more media scrutiny around the rationale.

Whatever that brings, we can certainly expect much in the way of choice language to defend and to criticise the changes, with Home Secretary Suella Braverman getting the ball rolling with “These goals are just that, goals, not straitjackets” and that some of the pledges are “arbitrary”.

With many companies having committed to goals that they still see as goals, we can expect business to be keeping a very close on eye on what comes out of Government in the coming days, and for this to be the overriding context of communication on environmental ESG commitments for UK firms ahead of the next General Election.

The ESG News Review is written by Steve Earl, a Partner at PR agency BOLDT.

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