Collaborative research shows drop in decarbonisation investment in East Midlands

The proportion of East Midlands businesses investing in decarbonisation has fallen by nearly four per cent, according to joint research published by the University of Derby and East Midlands Chamber. 

The 2026 Green Growth Trends report also found that those accessing support has fallen by six per cent, while the number of firms deriving sales from Green Goods and Services (GGSs) has declined by nine per cent.

Businesses engaging in nature-based solutions, meanwhile, has increased over the last 12 months, according to the report.  

Now in its 11th year, the Green Growth Trends report tracks and analyses awareness and engagement with green growth, decarbonisation and the uptake of nature-based solutions (NBS). 

University of Derby Associate Professor of Strategy and Sustainability, Dr Polina
Baranova, conducted the research on behalf of the East Midlands Chamber. 

She said:

"There are two major parameters within Green Growth – first, trading on green market niches, which we know is down, so businesses are selling fewer green goods.

"Secondly, businesses are reducing their involvement in decarbonisation, so they do not invest as much as they would like to. We’ve also seen decline in collaborative activities across the region.

"The positive is that businesses are becoming more aware about supporting nature and engaging more with nature-based solutions.

"In terms of green skills, we know the top five - energy efficiency, resource efficiency, business strategy, digital and waste management - have been consistent over the last three years, which should inspire providers of green skills in the region to hone into the area and provide something for businesses to take off the shelf.

Dr Baranova suggested that more needs to be done at government level, but that an unsettled economy is a cause for concern. 

She said:

"We have experienced increasingly difficult trading conditions in the UK and globally over the last 12 months; rise of crude oil prices and intensifying competition on green market niches as more businesses supply green goods and services are some of the contributing factors.

"Our study shows that green growth is sensitive to economic and political uncertainty, too, and needs sustained and continuous efforts by all actors of regional green growth ecosystem."

The report also calls for more support for decarbonisation by providing grants, demonstrator consultations and expert advice supported by wide-scale, sector-based incentives. 

Dr Baranova said: 

"Support programmes for eco-innovation and green R&D are of interest to build innovation capacity for green growth. Regional and national green business networks are important collaborative mechanisms that bring smaller and larger businesses together to share decarbonisation insights and form partnerships to maximise benefits of carbon reduction.

"We hope the Green Growth Trends report makes a real difference because you see the picture over time, rather than viewing individual findings in isolation. It gives policymakers valuable insight into the experiences and priorities of the business community, and hopefully, help inform evidence-based decision-making."

East Midlands Chamber Director of Policy and Insight, Richard Blackmore, said: 

"With the immense cost pressure on business at the moment, firms must assess the extent to which they can affordably prioritise decarbonisation while being profitable so Green Growth approach is going to look different from one business to another.

"What is clear is that having a strategy for some kind for Green Growth is not a ‘yes-no’, not a ‘nice to have’ or something to overlook - it must be tailored to operational business needs.

"For larger businesses to be leading decarbonisation investment, as shown in the findings of the 2026 report, is not really surprising when the level of resources available to smaller sized businesses may be more limited.

"The direction of travel we’ve seen across the 11 years the Chamber and the University of Derby have produced the Green Growth Trends report has been encouraging generally.

"Across that time, the findings have shown increasing commitment from East Midlands firms toward reaching sustainability goals, ahead of the slight drop seen in the 2026 data, which suggests tough trading conditions are now causing hesitancy.

"Ultimately, business will always need to strike the right balance to ensure financial performance is protected when determining the approach taken to sustainability."

View the full Green Growth Trends report