October 25, 2023 – According to the second annual BMO Climate Institute Business Leaders Survey, the business impact of climate change is driving more business leaders to think about mitigation plans, especially in the United States. Based on a survey of 700 business leaders in the U.S. and Canada, once again conducted on behalf of BMO by Pollara Strategic Insights, the 2023 results reveal why companies are increasingly taking action, how they are thinking about climate risk, and the challenges and opportunities they face in their transition to net-zero.
Even though, as in 2022, concerns like inflation and interest rates (89%), labour shortages (76%), and supply chain bottlenecks (75%) continue to weigh heavily, business leaders are increasingly paying attention to climate change:
- Nearly half (48%) of business leaders surveyed believe climate change is already affecting their businesses and even more (81%) anticipate it will affect their businesses in the next 5 years.
- A third (32%) of businesses have a plan in place to address climate change – up 6 points from last year – and 35% are in the process of developing one.
- U.S. business leaders (38%) are more likely to be moving forward with plans (up 10 points), compared to Canada where only 27% have a plan in place (up 3 points).
Though business leaders are slightly less confident in their ability to make a difference regarding greenhouse gas emissions, the survey identified actions believed to have the most impact:
- 76% of Canadian and U.S. businesses chose the use of renewable, compostable and recyclable resources.
- 61% chose tracking and managing supply chain emissions and cutting back on travel.
- Over half (53%) chose the purchase of carbon credits, up 6 points from 2022, and an 8-point increase in Canada alone.
Many business leaders think governments and industries could provide more realistic policies to help. Industry policies continue to be perceived as more lenient by all businesses, especially in Canada where only 44% of businesses find them ambitious (10% too ambitious, 34% ambitious but achievable).
The majority (68%) of businesses leaders continue to believe that financial institutions could play a role in helping companies become more climate-friendly. 22% (28% in the U.S. and 15% in Canada) say they are already playing this role, with 46% saying there is more they need to do. Among the products and services available from financial institutions:
- 77% of leaders are interested in the ability to generate insights on how business can adapt and thrive in an evolving climate landscape.
- 77% are interested in financial premiums for meeting climate-related targets, including discounted loans, and higher deposit rates.
- 76% value more analysis on how climate change will affect their business.
- 75% are interested in a tailored suite of green advisory, investment and lending products and services to support climate-related investments.
- 74% are looking for an easier way to track greenhouse gas emissions.
- 67% are looking for help with carbon offsets and trading carbon credits globally.
The second annual BMO Climate Institute Business Leaders survey was conducted by Pollara among more than 700 business leaders (at companies with at least five employees) in the U.S. and Canada between August 3 and August 24, 2023. Since the inaugural survey in 2022, the scope of the research has expanded to include more companies of all sizes. For more details and insights from the study, see BMO’s press release and report.