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The Tipping Point: Has COP26 Shifted the Focus of Business Energy Efficiency Targets from ROI to ESG?

Although energy efficiency targets are not a new concept in business settings, COP26 and the renewed focus on the climate crisis may have altered the intentions behind them for many companies.

Historically, businesses’ energy efficiency policies may have chiefly been concerned with lowering energy costs for the company. As a result, when considering the installation of energy efficiency technologies, the focus may have been on the financial ROI rather than the overall benefits it could generate. With this in mind, it may have been difficult to justify the cost of energy technology against other, potentially more financially rewarding investments such as store refits or advertising budgets.

However, COP26 has brought net-zero targets and environmental, social and corporate governance (ESG) strategies into the spotlight. There is a far greater understanding of the importance of improving energy efficiency from an environmental perspective. The urgency of this change in attitude is underlined when we consider that it’s estimated that, if businesses implement IoT and building control solutions, they can reduce their energy consumption by up to 30%. So why isn’t every business taking this action?

Previously its been down to a financial decision and a need for return on investment. However, with ESG and net-zero ambitions now taking precedence over ROI, IoT technologies have increased scope to support businesses in their drive to become more environmentally conscious. IoT technology, such as our CODA device, can provide granular insights into the health of the business’s buildings and the operational efficiency of its assets. This data makes it possible for a company to design an insight-led strategy that will drive out inefficiencies and make a tangible, positive impact on carbon emissions and energy wastage, as well as reduce day-to-day running costs.

The in-depth data provided by the CODA device can then be used to show the positive change in energy consumption after implementing the new ESG and net-zero strategies. Not only does this highlight the effectiveness of the technologies, but it serves to showcase the business’s commitment to making a genuine contribution to carbon reduction efforts.

Being able to evidence the progress a business has made concerning decarbonisation and energy efficiency may also be beneficial in terms of the company’s reputation. COP26 and the urgency of the climate crisis have prompted potential customers to take a genuine interest in businesses’ ESG to ensure that they’re investing in companies aligned with their own beliefs. The data provided by CODA can showcase the improvements that have been made and prove that the company’s claims and strategies are effective. This is also true for potential employees and investors who may also wish to know that the business is making meaningful changes to help create a cleaner, more sustainable way of working.


For more information on how CODA can help your business’s route to NetZero and reporting for your ESG strategies and investor relations, please contact the team on info@shields.energy.

If you are looking to save energy, reduce reactive maintenance and better manage your entire estate please contact us.

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