As the founding CEO of Chapter Zero, the directors’ climate forum, I have had the great privilege of working with our 3,500 members here in the UK—chairs, non-executive directors and senior business leaders, including 75% representation from FTSE 350 boards—for four years now. What has fascinated me most is how the issues over these years have changed the narrative on climate, as a reflection of how fast we are transitioning to a new economy.

Four years ago, we were helping members answer questions: what is climate change? How do I set my net zero pledge? How can I be compliant with regulatory demands? Today, we are talking about nothing less than board oversight of core business strategy and how climate is evolving the governance function itself.

This is because we are now in transition, globally and locally, inventing the new economy, and being forced to think and work in systems where entities and directors are relying on a whole host of actors in the value chain. This is one of the most demanding periods in history for chairs and board directors.

Uneven and sector-specific transition

The transition to a new economy is happening. Some sectors are fast transforming their strategies and operating models: utilities, automotive and energy, for example. While other hard-to-abate sectors, such as oil and gas, logistics and heavy industry, face greater challenges to progress.

For some companies, the transition plan is the business plan and a route to value creation. For example:
• Standard Life has targeted a 25% reduction in emissions intensity for listed equity and credit investments by 2025—and delivered a 58% reduction, more than double the target.
• ITV has ensured 92% of studio productions and 91% of all commissions secure BAFTA albert certification (the screen industry’s standard for sustainable production).
• BT Group has found that low-carbon products and green network solutions generated £6.5 billion in revenue in FY26, as part of its plan to deliver a 90% reduction in operational emissions by 2031.

There is evidence that advancing decarbonisation can unlock significant opportunities, create new markets and drive innovation. The London Stock Exchange Group reports that the global green economy reached a market capitalisation of $7.9trn in 2025. Similarly, the World Economic Forum has found that green revenues are growing twice as quickly as revenues in conventional business lines, while companies involved in green markets often secure cheaper capital and typically enjoy valuation premiums. Climate change and the board

There is no doubt that climate change is one of the structural issues reshaping the strategic and economic context in which companies operate. Its implications for business are profound.

It is the role of non-executive directors to make the case for action on climate and nature. Chapter Zero used the issue tree methodology to establish where these challenges are most acute, working with Chapter Zero board members and fellows. The findings were that:

1.  The business case for climate action is unclear and less attractive than other investments
2.  The context keeps changing—geopolitically, from a policy perspective and through technological shifts. This means it is more complex to summarise for the board
3.  Climate action depends on other changes, calling for a systemic approach
4.  Many directors do not have the climate knowledge or the optimal boardroom culture for effective judgement capability.

There is no getting away from the climate question for boards. It remains the case that, for board members, a double materiality approach (encompassing both the impact of the entity on the climate and the impact of the climate on the entity) is central to their fiduciary duty. Where directors struggle is in making a good assessment of physical climate risks and transition risks.

Indeed, Principle A of the UK Corporate Governance Code states that: “A successful company is led by an effective and entrepreneurial board, whose role is to promote the long-term sustainable success of the company, generating value for shareholders and contributing to wider society.”

So central to fiduciary duty is not just financial materiality but also impact materiality. Directors need to deliver for shareholders, but also to wider stakeholders and for wider society.

Board stewardship

Boards shape strategy and set the culture of an organisation; their governance and stewardship can act as a key enabler of corporate climate action.

Our 2025 survey of members, conducted for Chapter Zero pro bono by Kantar, revealed that 40% find they can most effectively deliver change by shaping the culture of their organisation. Also, 51% cite risk management and 31% highlight board structure and competencies as areas where they can drive change.

A core competency for those directors looking to drive action on climate from the boardroom is independence of thought alongside a strong mindset and the right expertise.

Ultimately, what we are facing now and in the future is a systems change challenge. Directors should be empowered to share their insights and engage deeply with the strategic and economic environment that the company faces. This was a key insight in a conversation we held with Rita Clifton, CBE, a portfolio chair and non-executive director, who highlighted the importance of pre-competitive and radical collaboration in the boardroom.

Leading on climate from the boardroom

Taking up the mantle of climate leadership in the boardroom is a difficult task for individual directors. However, it is possible with the right mindset and skills.

To understand how directors could establish this approach, Chapter Zero published Climate Competency in the Boardroom. This report brings together some of the world’s leading executive search firms and unites them around a shared framework for defining climate competency for boards, board advisors (including search firms) and individual directors.

To most effectively make the business case for climate action from the boardroom, it sets out that directors need:
• Knowledge of the strategic, economic and regulatory context
• Skills to integrate climate into board decision-making
• Leadership & mindset to steward the business transition.

What is fascinating is that climate is creating a demand for new forms of leadership. There is a need for directors who work through influence, are dynamic and compelling communicators, and can grapple with the scale and complexity of these issues that are coming into the boardroom today. Boards need ‘firestarters’.

Climate competency should not be considered a bonus skill for non-executive directors. By embedding it, boards can empower those across their business to take transformative action.

Boardrooms are the golden thread across the economy, with directors representing corporations, civil society, governments and arm’s length bodies. One thing is clear—this issue is not going away. Action is required. We can see from the past that we can innovate our way to a new economy, but it requires radical collaboration and new ways of working. This has already started and boards are at the forefront of this transition.

Vicky Moffatt is chief executive of Chapter Zero, the UK directors’ climate forum, a philanthropically funded membership organisation for NEDS, chairs and senior business leaders.