A recent study has revealed that 76% of the top 500 venture capital-backed (VC-backed) startups in the UK have taken no action to measure or offset their carbon emissions. These companies have collectively raised $40 billion in VC funding. The research also found that the highest-scoring VC firm in terms of climate actions achieved only 37 out of a possible 100, while the lowest scored a mere 3. Among the best-performing sectors in terms of climate action were fintech companies like Monzo, Oaknorth Bank, and Tide, while the worst performers included Doccla, Multiverse, Cera, and Motorway.
The study, conducted by climate measuring and offsetting startup Supercritical, analyzed 500 VC-backed UK companies with over $20 million in funding and more than 30 employees. The research evaluated a range of climate actions, including emissions measurement, carbon reduction, offset purchases, and the incorporation of climate roles within the business. The report also ranked VC firms based on their average climate scores, with Latitude, Molten Ventures, and Tencent achieving high scores and Samos Accel and Passion Capital scoring poorly.
The report revealed that Edtech companies performed the best on average in terms of climate actions, followed by climate tech, food, transport, and real estate sectors. Furthermore, it estimated that the annual cost of carbon measurement and high-quality offsets for these companies was £61,635, or around £4.98 per employee per week. The findings suggest that younger companies founded since 2016 are more likely to prioritize measuring their carbon footprint compared to older incumbents. Superficial Co-founder Michelle You emphasized the importance of the tech community taking climate action, with an average cost of £5 per employee per week to measure emissions and offset them using high-quality removals.
Overall, the study highlights the lack of climate action among many VC-backed UK startups, with only a few companies and investors demonstrating significant efforts to reduce their carbon footprint. It suggests that there is still a long way to go to ensure that tech companies, particularly startups, prioritize climate consciousness and play a leading role in tackling the climate crisis.