The latest BSI Net Zero Barometer shows a sharp decline in business confidence around meeting the UK’s 2050 net zero goal, with economic pressures and rising costs testing commitment despite a strong appetite for support and clearer policy direction.
Confidence among UK business leaders that the country can meet its net zero targets is slipping, according to the 2025 BSI Net Zero Barometer. The annual survey, now in its fifth year, found that 71% of business leaders believe the government cannot grow the economy while pursuing its net zero commitments, while half (50%) of respondents said the 2050 target is “unrealistic.”
The report, which includes insights from 1,000 senior business leaders and expert analysis, found that overall business commitment to the legally binding 2050 net zero target remains significant but is weakening.
Despite growing clarity on policy direction, this year’s Barometer reveals that UK business confidence in achieving net zero is weakening.
In 2025, 64% of businesses reported being committed to the goal, compared with 83% in 2024. The share of those “very committed” has also dropped from 31% to 25%. Furthermore, the proportion of companies confident they will achieve net zero by 2050 has fallen to 55%, down from 76% last year.
Despite improved clarity around clean energy policy – with uncertainty falling from 42% to 32% – more than half of businesses (54%) expect to revise their sustainability strategies in the coming year, and 49% anticipate adjusting their net zero targets. Economic headwinds are driving much of this hesitation, with 86% of businesses citing the cost of action as their main challenge.
Growing divide between large firms and SMEs
The report highlights a widening gap between large companies and smaller enterprises when it comes to net zero confidence. While 93% of large firms say they remain committed to net zero, only 64% of SMEs report the same level of commitment. Larger businesses also tend to have clearer climate goals – 82% have set specific net zero targets compared to just 36% of SMEs.
This divide is also reflected in broader optimism. While 61% of all firms remain optimistic about their performance over the next year (down from 76% in 2024), large companies are far more confident (89%) compared to micro-businesses (59%), which have seen a 17% drop in optimism since last year.
The survey also found that larger businesses face greater complexity when decarbonising, with 53% citing supply chain challenges and 45% highlighting limited financing for green technology, compared to 30% and 32% of SMEs respectively.
Call for more practical support
The appetite for practical guidance on achieving net zero remains strong, with 83% of businesses expressing interest in tools such as implementation guides, standards advice, and case studies. A similar proportion (82%) said they want more government support to meet net zero goals.
Scott Steedman, Director-General, Standards, at BSI, commented: “Our latest Net Zero Barometer business survey shows a hiatus in corporate activity, probably linked to changes in government policy in the UK after the election and international backpedalling, but if the new government can demonstrate renewed political commitment towards a future clean energy landscape, there may be an opportunity for government and industry to reset their collective net zero ambitions and build momentum again.
“The most important finding from the survey is that despite the slowdown, we found that 83% of UK businesses said that they were interested in support on how to make progress with net zero.
“Best practice industry standards are easy to adopt advice and, as the report explores, they are an essential tool for corporates trying to pick up the pace towards the delivery of their climate change goals. The 2025 BSI Net Zero Barometer shows that if we want to reinvigorate business on the net zero journey, our best chance is for government and industry to work together to agree next steps, including standards and accreditation as part of the solution, if we are to meet our national net zero ambitions.”
Sebastiaan Van Dort, Director of Sustainability and Energy at BSI, added: “Despite growing clarity on policy direction, this year’s Barometer reveals that UK business confidence in achieving net zero is weakening. While commitment remains strong in principle, the reality is that economic pressures and shifting priorities are slowing progress across the board.
“What is promising to see here is not a loss of belief in the need for climate action, but a call for more practical support. With over half of businesses expecting to revise their strategies or targets, it’s clear that many are adjusting their approach to balance ambition with what is feasible.”
The report found that 80% of businesses believe wider economic pressures – including the cost-of-living and energy crises – are hindering their ability to act, up from 57% last year. Customer demand remains the top driver for climate action (40%), followed by policy and regulation (29%), but the importance of mitigating climate risk has dropped from 43% in 2024 to 27% this year.
With just 36% of firms now reporting that they have a net zero target in place – down from 60% last year – BSI’s findings underscore the challenge of maintaining momentum towards 2050 in the face of mounting financial pressures.
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