Charities are lagging behind corporate counterparts when it comes to setting net zero goals. But what is preventing action and how can the two work better together?
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A 2021 survey by the Charity Finance Group revealed 84% of charities do not have a climate change commitment built into their organisation, while just 14% currently report on their carbon emissions.

The survey was carried out in October 2021 and indicated at the time that more charities would adopt this green commitment in the coming months. More than one third of charities (37%) said discussions among trustees had taken place about net zero and climate change.

Further research published last year found nearly a third (31%) of the UK’s largest 100 charities are failing to comply with government regulations around disclosing emissions and energy use.

The research, which was carried out by social and environmental impact organisation, Aleron, into sustainability and commitment to green issues in the UK charity sector, found that just seven top 100 charities have set net-zero emission targets and around a third (30%) did not have an ethical investment strategy. This is despite the charities analysed having
an average of £555 million in assets.

Yet since then, very little appears to have changed. While many of the UK’s largest charities have set strategies and started conversations, a cycle of short-termism – compounded by the cost-of-living crisis – has forced charities to put sustainability dreams on the back burner as they seek more immediate solutions to an impending financial crisis.

Most survey findings reveal a lack of understanding, costs and linking climate change to their charitable objectives are cited as barriers by charities to moving towards net zero.

Other challenges included accessing relevant examples of good practice and communicating the need for green policies among funders and beneficiaries. A recent Charity Times poll found similar results, with charities citing ‘a lack of knowledge’ as the main barrier to taking action.

“Many charities are already taking bold steps to become more sustainable and reduce their carbon footprint,” Richard Sagar, acting head of policy at CFG says. “However, many more are only just getting started on the net zero journey,” he adds.

“What comes across loud and clear from our research and through conversations with our members is that much more support needs to be provided to the sector, from infrastructure bodies like ours, government, the regulator and the for-profit sector.”

Reaching goals

Helen Moulinos, chief executive of advocacy charity, POhWer, explains how the charity began implementing a net zero strategy last year, with the aim of implementing it by 2025.

“We are working through policy changes, incentive plans for staff and investments to help us to reduce and neutralise our impact on the environment over the next three years. From 2025, we will adopt a full offsetting policy-driven investment to reduce any remaining footprint to net zero,” she explains.

“Our plan has seven key strands: having well-maintained buildings and facilities; buying renewable energy and promoting virtual working; recycling and reusing where possible; promoting use of public transport, walking, and cycling; reducing waste and consumption, and carbon offsetting.

“We have already made strides towards achieving our targets. More colleagues are working from home than used to be the case, and we’re encouraging our team to car share – or even better – walk or cycle to work if it’s not too far or inconvenient. We also have more renewable forms of energy powering our offices rather than burning gas or oil; we try to only buy secondhand furniture for our workspaces wherever possible, and we’re working with supply chain partners to reduce emissions, using our purchasing power, and favouring suppliers who share our commitment to reducing carbon emissions.”

POhWer is like many charities, in that it is taking active steps towards change, but needs support to help reach its goals on time. “One way to better achieve our goals would be for more partners and funders to get on board with us,” Moulinos says.

“They could help us to further evaluate where we risk not meeting our target and provide us with the tools necessary to achieve it.”

Corporate concerns

But thus far, there appears to be a disconnect between charities and businesses, which is stifling charities’ abilities to move forward in a constructive manner.

Businesses are arguing that charities are simply unwilling to put in the legwork through a lack of commitment to the environmental, social and governance (ESG) issues, while charities believe corporates aren’t doing enough to help.

The C&E Corporate NGO Partnerships Barometer revealed that just a quarter of corporate firms believe charities have “holistic ESG plans and frameworks in place”. Corporates’ view of charities’ ESG commitments has fallen by 17% over the last year, it added. The
concern has been backed up bycharities themselves, with less than half believing their sector has such firm ESG plans in place.

“This perception that non-profits’ approach to ESG falls short of stakeholder expectation represents a clear risk to the sector,” warns the report. “Whilst many non-profits have focused, core social and environmental missions, it is often not evident how effectively NGOs perform on wider ESG issues”.

A fear raised in the report is that while activities by charities may achieve societal change, they may also have harmful environmental effects “and vice versa”. “For NGOs
and non-profits, being perceived as a deserved paragon of virtue in one regard may not be enough to defend against criticism in an unrelated area,” it said. “There is therefore an imperative for non-profits to think holistically about the importance of the ESG agenda for their future evolution – and to demonstrate and communicate that holistic approach.”

Among partnerships between businesses and charities taking place, almost all said such link ups have helped corporate partners understand societal and environmental issues. Around half of those in both sectors say it has changed their business practice for the better and will be an imperative move towards having real climate impact.

Moving forward

Charities and businesses clearly agree there is a mutual need to help one another to achieve climate goals and the relationship between the two will be vital to making acceptable levels of progress.

The Scottish Council for Voluntary Action (SCVO) has stressed the importance of charities speaking up about the work they are doing on net zero goals to garner more support.

“[Taking action towards net zero] is likely to be important to your beneficiaries, donors and funders, so don’t be shy about telling people to help boost your reputation,” the umbrella body explains on its website. “Share what you’re doing on your website and social media channels.”

In turn, raising your voice is likely to lead to increased public support, too. As Moulinos says: “Public support is also extremely helpful. People responding to our call outs for second-hand furniture or goods, for example, means that we can reduce the need to purchase, and we would be recycling something which otherwise faces being scrapped. These are just some of the ways people, politicians and others could help.”

Governments have been handing out funding for charities across all nations, which will also prove to be a useful lifeline moving forward. In Scotland, for example, charities have been offered financial support from a £5 million fund to make the transition to carbon net zero. The funding was launched by Social Investment Scotland (SIS) and ZeroWaste Scotland and
offers loans starting from £10,000 and a small grant of up to £20,000. Similar schemes have been launched in England and Wales.

The help is there for charities who need – and want – to make headway to achieving their net zero goals, but it doesn’t mean it will come easily. This presents a need for charities and businesses to play their roles effectively. The commonality? A need for voices to be raised, knowledge to be shared and stronger relationships to be built. Only then will net zero goals become closer to being reached.

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