Carbon is Now a Cost of Doing Business – And an Opportunity
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South African automotive suppliers are at a crossroads. Global trade rules are shifting fast, and if local manufacturers want to stay in the game, they need to start managing their carbon footprint—today.
Why This Matters
Big global buyers, from car makers to retailers now want suppliers who can prove they’re cutting emissions. It’s not just a nice-to-have anymore, it’s the new standard. And it’s not just the customers. Banks and investors are also favouring businesses with clear sustainability plans. If your business isn’t “green enough,” you might get left behind.
Are Your Clients Ready?
According to a recent study many South African component manufacturers are ahead of the curve:
Having their sustainability plans in place.
Many are installing solar panels and tracking their carbon emissions.
Some are testing greener materials like green steel to future-proof their supply chains.
These early movers won’t just stay in business, they’re setting themselves up to win more contracts and attract green finance.
If you work with SME clients please complete the short (10–15 minute) survey from IFAC. Their goal is to better understand the extent to which sustainability-related information is being prepared by SMEs, used by SMEs in internal decision-making, or provided to supply chains, lenders, or other stakeholders. The survey is available HERE. Please see this short video for more information.
What’s Holding Us Back?
Despite the progress, there are a few roadblocks:
No common carbon reporting rules – Everyone uses different standards, confusing smaller businesses.
Lack of support for mid-sized firms – There’s help for big players, but smaller manufacturers are left to figure it out alone.
Coal-heavy energy grid – Even efficient factories get penalised because most of our power still comes from coal.
Financial pressure – With rising costs and shrinking margins, many firms are just trying to survive.
The Opportunity is Real
South Africa has everything it needs to become a global leader in low-carbon, high-quality manufacturing:
A well-developed automotive industry
Growing experience in renewable energy
Huge opportunity in green hydrogen.
ut there are challenges:
No clear, shared rules on how to report emissions
Smaller manufacturers aren’t getting enough support to go green
Our coal-based electricity makes everything look more “carbon-heavy”
Many businesses are just trying to stay afloat, so help must be practical and affordable.
The Bottom Line
While imposing additional compliance burdens on our industries, we must realise that carbon isn’t just an environmental issue anymore. It is a business issue. Companies that act now will win contracts, attract funding, and future-proof their operations. If we act now supporting businesses with better policies, green finance, and clear reporting rules so South Africa can lead in clean manufacturing.
Carbon readiness isn’t a box to tick. It’s the key to accessing tomorrow’s markets. Start with CIBA’s Sustainability Checklist for SMEs.
Article Source: Moneyweb
