Businesses are failing to adopt the green strategies that will support development and long-term competitiveness, warns industry ginger group Business in the Environment.

This is despite the fact that a link is beginning to emerge between companies that do well on the BiE green index and those that achieve sustainable growth.

BiE figures show that only four FTSE 350 companies are aiming to reduce their global warming emissions in line with the Kyoto agreement, and only one aims to exceed the target. The group says more companies would take up such commitments – and benefit from the improved performance – if financial incentives were offered and clearer targets set.

These facts emerged as the 4th BiE Index of Environmental Engagement was revealed last week. The index assesses performance in six areas of environmental impact: energy, transport, global warming emissions, waste and water consumption.

The key factors are the extent to which companies set targets, measure action and report results. The five top scorers were: Severn Trent, BT, Cable & Wireless, Woolwich and Thames Water.

Participation from most sectors was quite good, though numbers from the engineering, construction and IT industries were notably low.

Commenting on the process, BiE Chairman Derek Higgs said: "The index identifies a range of environmental issues that are in fact corporate financial risks. I would sum these up as the potential threat to competitiveness from pursuing a strategy which is not sustainable. If boardrooms take this on board, they will find both their companies’ performance, and our environment, improve still further."

Elliott Chase