As businesses step up their sustainability ambitions, and set out ambitious science-backed pathways for carbon reduction, the focus turns to delivery. But how can an organisation activate the right culture and skills to unlock innovation and deliver its bold climate-related targets by 2030?
December 15, 2020
Two years ago, the Intergovernmental Panel on Climate Change (IPCC) released its report, and called for urgent global action to limit global temperature increase to 1.5 degrees centigrade. Propelled by the severity of the warning and the growing number of environmental disasters, climate change entered mainstream discussions. The World Economic Forum (WEF) reported that for the first time in its history the top five most likely global risks all relate to climate change and the environment. And a new generation of climate activists made sure their message was heard.
This is a climate emergency. We have a decade to stop temperatures increasing beyond 1.5 degrees.
And it became clearer than ever that business had a crucial role to play in radically reducing global emissions.
“Today, our societies are facing unprecedented social and economic crises , giving rise to situations of great human suffering. This must not eclipse the need for strong environmental commitments and action. Collectively, we must accelerate our efforts to build a more sustainable future. This requires new, bold measures to fight climate change and prevent the erosion of biodiversity, which both profoundly threaten to shake our lives, our societies, and our economies.”
Jean-Paul Agon, Chairman and CEO, L’Oréal Group
A Pathway to Zero Carbon
In response to the growing climate emergency, and despite the intense economic challenges of a global pandemic, this year we have seen a sea of organisations move beyond headline sustainability commitments, and go to the next level — defining a pathway / a roadmap / a trajectory, for achieving zero carbon and transitioning to net positive carbon in their business. The number of companies committing to zero carbon no later than 2050 has risen from 20% in 2019 to 45% in 2020 (Ecoact report: The Sustainability Reporting Performance of the FTSE 100).
And why now? For too long businesses and industry bodies alike got stifled with important, but also highly complicated conversations on definitions— What do we mean by zero carbon? Is that different to carbon neutral? Does it mean something different in Australia to what it does in the UK? And whilst these were incredibly important discussions where clarity needed to be achieved, leading businesses have moved beyond deliberating and debating, realising they needed to have a plan in place to make a serious contribution to reducing global emissions. Gone are the days of vague statements about carbon reductions. 2020 became a year in which responsible businesses backed up their courageous commitments with clear trajectories on how to achieve it. Here are just a few examples:
- Canary Wharf Group: Net Zero Carbon Pathway (timeframe: net zero carbon by 2030)
- Danone: Toward Carbon Neutrality (timeframe: carbon neutral by 2050)
- Grosvenor Britain & Ireland: Think Zero (timeframe: net zero carbon by 2030)
- Microsoft (timeframe: carbon negative by 2030)
- MITIE: Plan Zero (timeframe: net zero carbon by 2025)
- NHS England: Delivering a ‘Net Zero’ National Health Service (timeframe: net zero cabon for directly controlled estate by 2040; full supply-chain net zero carbon by 2045)
- Nike: Move to Zero (timeframe: net zero carbon by 2030)
- Unilever: Net Zero 2039 (timeframe: net zero emissions for products by 2039)
- Water UK: Net Zero 2030 Routemap (timeframe: net zero carbon by 2030)
- WHSmith: Our Journey to a Better Business (timeframe: net zero emissions by 2025)
- Willmott Dixon: Now or Never; our decisive decade (timeframe: net zero operational carbon by 2030; net zero embodied carbon by 2040)
Features of Zero Carbon Pathway
Fundamental to a zero cabon strategy must be significant decarbonisation (aligned to science-based targets (SBTs), and innovative measures to meet these targets — e.g. renewable energy, low carbon products and services. Across these examples, we see the zero carbon pathways consider these elements:
- Reducing operational carbon: Increasing the efficiency of assets, processes and maximising existing resources to reduce their carbon intensity, reducing energy demand, and using frameworks such as science-based targets to assess progress
- Generating energy onsite: Generating energy on-site through renewable/low-carbon means (for organisations with built assets such as factories, warehouses, shops or offices)
- Procuring renewable energy: Sourcing energy from sustainable and renewable sources where on-site generation isn’t feasible
- Reducing embodied carbon: Prioritising materials with low carbon intensity; assessing and reducing Scope 3 emissions including through supply chains; mitigating waste to landfill/incineration and prioritising reuse and recycling, and adopting frameworks such as science-based targets
- Offsetting excess carbon: Where carbon intensity can’t be reduced elsewhere, use of high-quality, ethical and transparent offsetting and sequestration initiatives to “keep it in the ground” are accepted
- Verification: Using third-party verification services and publicly disclosing the results.
What Else is Needed Beyond a Plan for Zero Carbon?
Many of the zero carbon plans cited above have been put together in a rigorous, highly technical and science-based manner. Which is absolutely right. Climate science is driving this, and it is crucial that pathways to become, zero carbon, carbon neutral, climate positive, (whatever the target) are set out in a forensic way.
But what then? You’ve got your vision, your targets, you’ve even got a detailed plan. But what about achieving the bold ambitions in a 10 year window? When we ask businesses this question “what could get in the way of us achieving this?” we hear this kind of response: “the culture” “not making decisions quick enough”, “lacking courage”, “getting stuck in the jargon”.
And the reason for this is because many businesses have a tendency to focus on only one type of problem solving — the technical. And for these businesses they are likely to find achievement of ambitious goals like zero carbon very challenging. Whilst technical problem-solving is absolutely crucial for establishing the zero carbon pathway, achievement of bold sustainability targets will require a mix of technical and transformational problem-solving.
Technical vs Transformational Problem Solving
The table demonstrates the the difference in approach, and the absolute necessity of both technical and transformation problem-solving when embarking upon the achievement of zero carbon and climate positive targets. This is because bold sustainability ambitions will not be achieved by continuous improvements — business innovation will required to achieve breakthroughs in operational energy reductions, renewable energy production, and embodied carbon reduction. And when you are asked to rapidly adapt the business model, this calls on transformational problem solving.
Employees, suppliers and customers alike must be ok without knowing the answers, be ready to adopt a curious and creative mindset, to leave outdated assumptions behind, to experiment, to discover new roles, and engage in new partnerships to co-create solutions. This an agile an entrepreneurial culture that constantly remembers the zero carbon plan will need to flex and evolve in response to external factors such as technology developments, consumer trends, market conditions and political landscape, all of which will be constantly changing over the next 10 years.
Practical Ideas for Activating Your Zero Carbon Pathway
With the plans drawn up, businesses are now considering how they bring their zero carbon pathway to life in the organisation and the enablers and activities that will need to be in place for business transformation. And here are some of our ideas for what those next steps could look like:
- Linking business purpose to sustainability and zero carbon ambitions
- Integration of zero carbon strategies with wider business transformation initiatives
- Zero carbon working groups (to include external through leaders, customers and suppliers)
- Zero carbon organisational capability review (considering business structure, recruitment, and roles and responsibilities)
- Zero carbon jargon busting guides
- Carbon awareness training and empowerment programmes for everyone in the business
- Zero carbon focused coaching and leadership development for Board
- Innovation sprints for achieving zero carbon (1 day to 1 week in duration)
- Customer engagement and partnership on zero carbon solutions sourcing
- Zero carbon communications campaigns
- Transformational innovation programme (rethinking business models for carbon positive solutions)
- Creative and engaging storytelling on zero carbon breakthroughs
- Shareholder engagement on zero carbon targets and activities (e.g. Unilever to let shareholders vote on new climate targets)