Organizations looking to create climate risk, net zero and biodiversity strategies continue to come up against the climate skills gap. Verdantix research has shown that growing requirements for climate strategy and implementation will require a significant shift in skilled professionals. However, climate-related talent pools are currently distanced from corporate talent acquisition search areas – often concentrated in academic and governance hubs. Check out our infographic for more information.

How does the climate skills gap impact corporate strategies to manage climate risk, carbon and biodiversity?
As firms need to outsource climate risk expertise and data, lack of internal expertise can drive investment in climate risk digital solutions. However, it can also pose a barrier to investment. Organizations are unsure of climate risk use cases, and the requirements and resources needed, so they are struggling with where to start. This is a particular challenge for climate risk analysis due to the wide range of different physical and transition risks, the significant number of different data points needed and, often, the specific climate science expertise required. Firms should look to engage consulting providers, as they can offer more support and education.

Carbon management software is fairing better with the climate skills gap, as emissions calculations have been managed by EHS and ESG teams both for environmental compliance purposes and voluntary ESG reporting for years. For example, the CDP (formerly the Carbon Disclosure Project) was founded back in 2000, while the TCFD’s recommendations were only finalized in 2017. Despite this, carbon management still requires a steep learning curve. One fintech firm that Verdantix interviewed said that implementing and using a carbon management software “is not a pet project, it’s going to be hard to understand how to use the information. It’s a challenging task, the software won’t tell you what to do, it can’t give you the strategy, you have to do that yourself”. A significant amount of training and education is still required for complex emissions calculations and following through on net zero programme management. However, considering the greater long-standing organizational expertise in emissions measurement, teams shouldn’t face significant obstacles in working with a pure-play SaaS carbon management vendor.

Biodiversity strategies and reporting, on the other hand, are just emerging. Nature-related reporting is included in the EU’s CSRD – which is coming into force in 2024 – and the TNFD, following on from the TCFD, was finalized in September 2023, with a cohort of 319 early adopters announced at the beginning of 2024. Not only is there a corporate ecology and nature skills gap, but also a lack of skilled external professionals for the increasing scale of work. A 2023 survey of over 500 nature and environmental experts run by Prospect found that nearly 70% of participants considered overall staffing levels too low and over 50% reported vacancies in their teams. However, considering the scope of nature and biodiversity strategies – both in the variety of data components and the number of interconnected elements – we anticipate this may follow in the footsteps of climate risk analysis, where organizations require additional support and guidance from consultants. As demand grows, consultancy firms are rushing to launch nature and biodiversity practices. Witness PwC’s practice launch in April 2023, while digital solutions providers, such as NatureAlpha, continue to launch or develop nature-related offerings. It remains to be seen which route corporate decision-makers will go down to support their biodiversity strategies as the complexity of analysis and lack of appropriately skilled workers comes to a head.