Net zero momentum remains strong among UK businesses

A large majority (79%) of UK firms still consider net zero as a strategic priority for 2026, despite recent political fragmentation on the topic.

In a survey of over 2,000 UK businesses, only 3% of large companies and 25% of SMEs said net zero brings no benefits. Most are still planning to invest in climate action in the coming year, though 70% worry about regulatory uncertainty.

The survey, published today by the UK Business Climate Hub in partnership with Planet Mark, Sage and the British Business Bank, was conducted in the wake of a shock announcement by Conservative Party leader Kemi Badenoch that he would repeal the UK’s 2008 Climate Change Act if his party won the next election.

Andrew Griffiths, Policy Director at Planet Mark said: “Although the political consensus on climate action is destabilising, British businesses are still clearly committed to net zero. When leaders look at the evidence and think about long-term strategy, it is becoming increasingly apparent that the businesses that act today to enhance efficiency, reduce emissions and build resilience to environmental impacts are setting themselves up for success in a more sustainable future.”

Carbon data requests on the rise

The survey also highlights the emphasis placed on data collection, with 51% of companies having received requests for carbon data from customers or as part of tender applications – 62% among those exporting to international markets.

Even among SMEs, 37% of medium-sized businesses, 20% of small businesses and 8% of microbusinesses have also been asked for carbon data by customers in the last 12 months. 

Henrik Micsk, Senior Climate Manager at Sage, added: “It is positive that the data illustrates progress towards net zero action amongst businesses, but it also highlights the significant challenge that still exists to align with a 1.5-degree world. As a result, this dataset provides vital information to support the drive for faster and more targeted policies and action.”

Challenges on the way to net zero

Among the top challenges cited by businesses on their way to net zero, regulatory uncertainty remains a significant roadblock for 70% of respondents, along with high costs (80%) and a lack of finance or grants (69%).

To support progress, the report calls on policymakers for greater regulatory clarity and standardisation, including the publication of UK Sustainability Reporting Standards and Streamlined Energy and Carbon Reporting updates. In addition, it recommends expanding access to financial mechanisms to support SMEs in starting carbon reduction projects. 

Hannah Gilbert, Director of Sustainability at British Business Bank, said: “Businesses of all sizes have a role to play as innovators, employers, and community anchors. By exploring their net zero journeys, we can learn how best to back them — ensuring they contribute to and benefit from the UK’s green transition. It is encouraging to see that over three-quarters of smaller businesses have already taken steps towards net zero as they will be critical to the UK’s transformation into a low-carbon economy.”