The catalyst effect of the finance function on decarbonization

Introduction

Decarbonization is a strategic goal, underlined by ambitious carbon targets, which is widely adopted within larger Dutch organisations. We see that decarbonization is a central theme in the Future of Energy, the Future of Mobility and the Future of Food. In addition, major financial institutions have also embraced decarbonization, which we can conclude from their adoption of the Dutch Climate Agreement. Finance departments have a critical role in the sustainability transformation of their organizations. In this article, we will explore how internal carbon pricing can accelerate the sustainability transformation, that many organizations now want to make.

Key takeaways:

• Sustainable ‘purpose-led ’companies outperform their traditional peers
• The application of internal carbon pricing leads to higher financial and social performance
• CFOs can actively play a role to drive decarbonization and anticipating carbon tax

Internal carbon pricing can have a significant impact on the finance function. If carbon pricing becomes a key pillar of the finance strategy the finance function can have a catalyst effect on decarbonization. To make the potential of decarbonization viable, we mapped the impact on the Deloitte Finance Assessment Wheel, a comprehensive, organized landscape of finance competencies and enabling areas.