Why Should Your Company Have A Net Zero Strategy?
Net Zero is taking off in a big way (hooray!) In March 2021 Forbes estimated that a fifth of the largest companies in the world had a net zero target. Just over a year later, Time recorded that a third of the largest publicly-traded companies in the world had made pledges and that’s not accounting for small and medium sized businesses.
With more and more companies joining the B Corp movement, taking pledges such as those by Protect Our Winters, or committing to Science Based Targets amongst others, it’s clear that net zero is the new black (or perhaps green) for businesses of all sizes across all sectors.
If your company doesn’t yet have a net zero strategy, read on.
What does Net Zero mean?
Net Zero means reducing the greenhouse gas (GHG) emissions that your company is responsible for by 90-95%, purchasing a particular type of offsets for the remainder.
A Net Zero target is the year by which you plan to achieve this.
A Net Zero pledge involves setting your target in line with the Paris Agreement’s aim of keeping global temperature increases below 1.5 degrees compared to pre-industrial levels. With a pledge you also commit to publishing your progress year on year.
All businesses are likely to need a Net Zero strategy
Why is a Net Zero strategy important?
The Intergovernmental Panel on Climate Change (IPCC) has told us that to avoid catastrophic damage to the planet, global warming must not exceed 1.5°C above pre-industrial levels. We’re currently on track for a 3+°C increase in global warming. This is a global crisis that requires all of us to act immediately.
To preserve ecosystems and life as we know it, businesses need to reduce their carbon emissions by 50% by 2030.
The largest companies are already required to disclose some of their emissions, it’s not a great leap of logic to suggest that further legislation extending to all businesses is in the pipeline. Setting a net zero strategy now can only be a benefit in the longer term.
Customers want to make more sustainable purchases. Depending on the report you read, between 65-80% of people say they want to buy from sustainable businesses. There are also opportunities to be had. Sustainable businesses are often more profitable thanks to savings made from efficiencies and greater customer appeal.
Is carbon the only important metric?
In a nutshell, no, but If carbon reduction is done right, it should have side effects that benefit other areas such as reducing single use waste. You might be surprised at what is included when measuring a carbon footprint, for example, the amount of water you use (yep, that has a carbon cost too).
How do I go about setting a Net Zero target?
The first thing to do is measure your current carbon footprint. Once you have an understanding of where your carbon emissions come from, you can work out where the opportunities for reduction are and work out how long it might take to reach net zero.
Simple right? It can be. It typically takes us 1-2 months to measure a company’s carbon footprint accurately and determine a Net Zero target date with ambitious but achievable targets.
When should I set a target to reach Net Zero?
The short answer is the sooner the better. To achieve the science-based target of a 50% reduction by 2030, your company needs to reduce its emissions by 7-8% each year if you start now. If you delay starting, the percentage by which you will need to reduce each year will go up, making it MUCH harder to achieve.
Find out more about our work here and contact us if you have any questions.
