In the wake of the 2021 United Nations Climate Change Conference (COP26), businesses around the world have made moves in response to the coming climate crisis.
German software giant SAP announced a new “Responsible Design and Production solution” which helps companies “gain better visibility of material flows through their processes including tracking and complying with rapidly changing regulations, especially those concerning product packaging and plastics”.
In the UK, Starling Bank pledged to offset its carbon emissions from 2021 onward while TSB joined the UN-created Net-Zero Banking Alliance.
UK Finance published a lengthy report analysing the financial and governmental responses to COP26 and how policies are shaping the future of climate-conscious business in the UK.
On the government side of things, UK Chancellor of the Exchequer Rishi Sunak talked of renewing a pledge for $100 billion (£73.2 billion) a year of public funding.
But a lot of that is PR and press releases, spin designed to make the company look good. Whether or not the company is actively working to conduct more environmentally-friendly business is secondary to the appearance of being environmentally conscious, which is fair. For companies, especially publicly-traded companies, it doesn’t matter how much good you do if investors and traders still think you’re as carbon-intensive as an oil tycoon.
That said, there are efforts to drag these companies out of the PR spin and into the light. Proposed Treasury rules indicate that firms might be forced to detail exactly how they plan to meet the UK’s net-zero emissions target by 2050. Whether or not these rules will have enough regulatory teeth to matter is up for debate, however.
More importantly for us, how is the tech world moving toward a net-zero future? Well, on quantity alone, the UK seems to be sprinting. London alone now holds $28 billion (£21 billion) worth of climate tech startups, the most of any city in Europe. But numbers only tell part of the story.
Players, Power and Potential
There are of course plenty of companies looking to prosper in this sector.
First, startup Sourceful aims to help businesses make more environmentally conscious decisions regarding their supply chains. Someone seems to believe in them, as the company received a $12.2 million (£9.1 million) investment seed earlier in the year. Whether Sourceful has some bite to go with its impressive bark will be seen in early 2022 when its end-to-end sourcing and supply chain platform is set to launch according to their website.
London-based Climate X’s goal is to provide climate data and analytics which could help predict the physical risks (i.e. extreme weather) caused by climate change. Most recently, the company raised $1.5 million (£1.1 million) in funding from various investors to help accomplish their mission.
Born from the University of Bristol’s Hydrology Research Group, Fathom provides flood risk models and analytics that could help businesses prevent loss of revenue and life due to extreme weather events. Earlier this year, the company received an investment from Moody’s and is being advised by tech investment bank ICON Corporate Finance.
Over in Leeds, Hark’s analytics and industrial IoT solutions allow businesses to maximise their energy efficiency and reduce waste, making it easier to hit the UK’s 2050 deadline to reach net zero.
Risilience’s analytics and SaaS platform can help companies see how the potential climate change effects and risks their actions could cause. This can allow businesses to make more strategically-minded decisions regarding climate change to more efficiently hit the net zero deadline. Its major clients include the likes of Nestlé and Burberry. Most recently, the company raised $8 million (£6 million) in funding from a group of international investors headed up by IQ Capital.
While, Pledge’s suite of climate solutions can help companies manage the environmental impacts of their products more efficiently, allowing them to reduce or offset the potential harm caused by said products. In October 2021, the company received $4.5 million (£3.3 million) in funding from various investors including Breyer Capital.
Climate change tech startups are much like the tech startup sector: full of promises and hype with so-far little to show for all the bluster. That’s to be expected; they’re startups. Very few startups come to market with the sort of tangible progress needed to fight climate change.
That said, startups are also often at the forefront of progress in the tech sector, and in a field like climate change, new ideas, even ones that don’t work out, can be vital to future success. But even a successful company that 100% accomplishes everything it claims to do will only be a small piece of the overall puzzle that is climate change.
The above companies are just a sampling of the growing climate tech sector in the UK. There are so many more out there covering areas like transportation, refrigeration, waste management, agriculture and more.
Will one of them find an answer to one of the many problems climate change brings us? Only time will tell.