According to a new survey from the RBC Climate Action Institute, 91% of executives said their organization had a GHG emissions reduction strategy, up from 73% last year. However, fewer executives believe their organizations are on track to meet their goals. / ISTOCK PHOTO

Canadian companies are increasingly developing strategies to cut greenhouse gas emissions, but confidence in meeting those business targets is declining, according to a new survey from the RBC Climate Action Institute.

The latest annual survey of 150 executives found 136 respondents, or 91%, said their organization had a GHG emissions reduction strategy, up from 73% last year. However, fewer executives believe their organizations are on track to meet their goals. The share of respondents “agreeing” or “strongly agreeing” that their organization will reach 2030 climate targets fell to 71% this year, from 81% last year.

The findings from the RBC Climate Action Institute’s Climate Action 2026 report suggest businesses are in what the institute describes as “review-and-reset mode.”

“Climate action is among the biggest collective needs humanity has faced,” John Stackhouse, RBC Senior Vice-President, said in a press release. “With 25 years until Canada's 2050 net-zero target, we're at a critical moment. This is not just about emissions—it's also about harnessing the technology, funding, innovation, and collective action required to carve out pathways to a low-emissions future.”

The pullback from business comes amid what the report describes as “tectonic shifts” across the Canadian and global economy, including disruptions to trade, investment flows and energy security. Nearly three of five senior leaders said their companies are planning to scale back, or have already scaled back, their climate commitments or targets.

Many are wary of political repercussions

More than a quarter of executives cited the risk of political blowback in the United States as a key factor in their company’s decision, while just over 20% pointed to shifting sentiment in Canada.

Despite those pressures, the survey notes that “Canadian businesses hold on to hopes of meeting their 2030 climate targets.”

Executives largely see themselves as responsible for driving climate progress. Corporate priority was identified as the biggest driver of emissions reduction strategies, cited by 63% of respondents, followed closely by government regulation at 60%. The survey notes that with several federal and provincial climate policies in retreat, it remains to be seen whether corporate GHG strategies will weaken in future years.

At the same time, the survey recorded a decline in companies switching away from fossil fuels, which fell to 46% from 52% in 2024, and in electrification efforts, which dropped to 48% from 59% a year earlier.

Customer demand continues to influence corporate decision-making. More than half of executives, 54%, cited customer or client demand as a key driver of their climate strategies, little changed from last year despite affordability pressures. By contrast, only 30% identified investor demand as a major factor.

Cost remains a significant concern. Sixty per cent of executives said implementing sustainability policies led to a moderate cost increase of between 5% and 15%, while another 13% reported cost inflation exceeding 15%. The survey did not define which sustainability policies companies were pursuing.

The pricing upside of lower-carbon products

However, many executives also reported benefits. About 32% said they were able to command premium pricing for lower-carbon products and services, 29% reported securing new market access, and 45% said their climate initiatives helped attract new customers and business partners. Nearly a third said they faced cost disadvantages compared with competitors with fewer climate considerations, while a fifth reported seeing no difference.

When asked about obstacles to further emissions reductions, executives most frequently cited lack of access to capital, along with challenges qualifying for government incentives, regulatory uncertainty and broader macro-economic conditions.

While adoption of technologies such as electric vehicles and heat pumps has risen, it often depended on subsidies. The report noted that Canadians are “less interested in climate issues, given growing concerns over economic security,” though many still want to reduce their carbon footprint through low-cost actions. Concern about wildfires is also rising, with 60% of respondents placing greater emphasis on climate action when extreme weather hits closer to home.

On the industrial side, investment in areas such as carbon capture and biofuels has been slower than expected, because of weaker growth, investor demands for near-term returns and trade pressures that “may further diminish industrial climate action.”

Government support remains critical, the report said, but fiscal capacity is increasingly constrained. “Governments and companies borrowed $25 trillion in 2024,” triple the level before the global financial crisis, limiting the ability of governments to scale climate-related spending. In Canada, the report found “a decline in emphasis on policy measures,” fewer new funding commitments and a greater focus on climate “narrative” rather than emissions reduction.

The world may be moving toward a “Paris 2.0” era, where emissions reductions “will take a bit longer,” even if net-zero by 2050 remains possible, the report said.

“Tech breakthroughs may be the best hope for climate action in the year ahead,” particularly as governments, consumers and businesses take a more cautious approach.