CEO, EcoAct UK
With an ever-narrowing window for action to limit global warming to 1.5 degrees, more and more companies are committing to achieving net zero status.
Net zero means adding no incremental greenhouse gases to the atmosphere. For companies to achieve it, they must carry out significant decarbonisation, and sequester any emissions they cannot reduce.
Stuart Lemmon, CEO of EcoAct UK, an Atos company, says, “We’ve effectively only got 10 years to save the planet. Rather than just gradually reduce emissions, we need an end point we all agree on, and that is net zero.”
“The simplicity of that goal has really catalysed action. Net zero is something that companies intuitively understand and can easily communicate.”
Implementing net zero strategies
According to EcoAct’s annual research into corporate climate disclosures, despite a significant increase in corporate commitments to net zero, few are matched by robust strategies or take the whole value chain into account.
“A strategy is actually relatively simple,” Lemmon says. “The difficulty is understanding what the implications will be.”
“Net zero requires significant and transformational change. It involves looking in detail at the carbon footprint of all operations and the value chain, identifying hotspots, evaluating options for reduction, and engaging with employees, customers and suppliers.
“It can seem huge and scary, but by approaching it in bitesize chunks, a roadmap begins to unfold.”
Measure, reduce, offset
Companies seeking to achieve net zero should focus on a three-part process, Lemmon added.
“Make a detailed measurement, reduce emissions as much as possible, then offset the residual to achieve a net zero position.”
Offsetting will inevitably be involved in any journey to net zero.
“It’s difficult for businesses to get to zero and do so quickly. A lot of net zero strategies will therefore include an element of carbon offsetting, and for net zero that will need to be carbon sequestration.”
Impact of the pandemic
In the current climate, companies are under pressure to make savings wherever possible. However, sustainability targets look likely to be prioritised even in these straitened times.
“During the 2008 financial crisis, sustainability was seen as discretionary spending and was one of the first things to be cut,” Lemmon recalls.
“In contrast, many businesses that have been severely impacted this year have kept their sustainability team even when they have furloughed others. It is much more of a priority now for businesses, their customers, and, significantly, for investors too.
“The fight for capital post-COVID-19 is likely to be focused on sustainability, so companies that are doing it well and have good plans in place will benefit.”