Climate change is an important business issue for India Inc, even though more than half of these businesses do not have a clear strategy in place to tackle the environmental challenges, a latest KPMG study says.
The study revealed that 83 per cent of Indian business leaders believe to have fair to good understanding on the issue of climate change. However, just under half of these respondents stated they have a clear strategy in place to respond to these issues.
There is a significant gap between good intentions and action as only 21 per cent have measured their current carbon footprint, which is one of the first steps in defining a strategy to deal with the issue, the study noted.
The report points out while a number of Indian businesses claim to be aware of the need to reduce their carbon impact, and believe they are taking steps towards it, 16 per cent of respondents don't see the need for such an analysis.
On whether the climate change issue is high on India Inc's business agenda, about 41 per cent of respondents considered themselves as having a good understanding of the issue and having a clear strategy in place.
A further 42 per cent claim to be in the process of developing their carbon strategy.
"Developing countries are under increasing international pressure to undertake measures to limit emission levels. The government has recently announced the National Action Plan on climate change, the onus is now on private businesses to do their bit," KPMG National industry Director Energy Arvind Mahajan said.
"Merely good intentions with regard to environment awareness is not enough, a structured and measurable plan is needed. The first step to the process is measuring the current carbon footprint," Mahajan said, adding, "Secondly, companies should seek to benefit from opportunities brought by climate change.
"For instance, the global market for low carbon energy efficient technologies is estimated to be 3 trillion dollar by 2050."
Although corporate India is positive in the global outlook with 65 per cent of respondents indicating that India should be leading the way, they expect the government to lead by example.
"While there is a keen desire for India to take the lead in responding to climate change issues, the results reveal that businesses want the government to take the lead in education, leading by example, and in adoption of technology," the report stated.
However, they are of the opinion that the government is not doing enough in these areas at present, it added.
A further 46 per cent of Indian businesses indicated that climate change is an important issue, but there were others that are more urgent on India's business agenda.
The report highlights that with the global market for low carbon energy efficient technologies pegged at $3 trillion by 2050, Indian companies would have an opportunity to leverage climate change as a competitive advantage (rather than a threat).
Companies need to plan their approach, measure their impact, adapt their model to a low carbon business and report on performance accurately.
Further, the report predicts that with business continuing as usual, climate related disorder would result in a GDP loss between 5 to 20 per cent.
"While the cost of action is lower than that of inaction, it is still a significant cost, more so for rapidly growing countries like India, and has implications on choices for reducing the energy intensity of the growth trajectory," the study noted.
© 2025