Emissions reduction targets & Sustainability Reporting

Put simply, net-zero is a state where we add no incremental greenhouse gases (GHG) to the atmosphere. This means emissions output is balanced with the removal of carbon from the atmosphere via carbon sinks (e.g., forests, mangroves, carbon capture and storage, etc.).

The Corporate Net-Zero Standard, developed by the Science Based Targets initiative (SBTi) in 2021, provides businesses with a clear blueprint on how to achieve net-zero. With a strong focus on emissions reductions, businesses are required to reduce emissions by 90-95% by 2050. To achieve net-zero, the remaining 5-10% should then be removed through carbon offsetting projects (e.g., forest conservation, afforestation, reforestation, improved forest management, regenerative agriculture, renewable energy, fuel switch, etc.).

We need to limit global temperature increase to 1.5°C in line with the Paris Agreement, yet a 2.7 degree temperature increase against pre-industrial levels is expected based on current climate policies around the world. An increase greater than 1.5°C will result in catastrophic events, including 36% of land being exposed to extreme rainfall and habitat loss doubling. With only 8 years left to align with the Intergovernmental Panel on Climate Change’s (IPCC) recommendations of halving global net emissions by 2030, the need for action to achieve net-zero is greater than ever.

In addition to the risks facing society as a whole, a changing climate poses significant risks to many businesses. Without bold action to achieve net-zero and meet stakeholder needs, businesses could be at risk of non-compliance, supply chain instability, and being exposed to extreme weather events. There are however many opportunities within this changing landscape, and it is in the interest of businesses to become net-zero.

Creating a net-zero plan starts with understanding your climate impact, agreeing on the boundaries of your climate ambitions and devising a robust and informed strategy for action.

1. Start with an emissions inventory and analysis

To become a net-zero business, the first step is to undertake an emissions inventory and define the emissions within the entire value chain of your organisation – Scopes 1, 2 and 3. Scope 3 emissions can be the most difficult to define, however are often the biggest source of emissions for most businesses. From this baseline of emissions within your organisation you can then establish near and long-term science-based net-zero targets and a net-zero strategy.

2. Set net-zero targets

Following the publication of the new Net-Zero Standard, well defined near- and long-term targets for reaching net-zero are required. Near-term targets should cover emissions reductions for the next 5-10 years, roughly halving emissions by 2030. Long-term net-zero targets should see a reduction of 90-95% of emissions by 2050, with some variations between sectors.

3. Reduce your emissions

Following the creation of valid net-zero targets to guide your net-zero strategy, the most crucial stage of becoming a net-zero business is reducing emissions within your value chain. A reduction in emissions across your value chain can be achieved through efficiency measures, increased stakeholder collaboration, renewable energy and investments in business transformation.

4. Offset residual emissions

To be able to claim net-zero you will need to achieve the full emissions reductions (90-95%) and then offset the remaining 5-10% of emissions via projects that remove (sequester) carbon from the atmosphere. However, given the urgency of the climate crisis and our need to protect existing carbon sinks and support sustainable development internationally today, it is recommended to begin offsetting in parallel with emissions reductions. As a project developer, EcoAct supports many carbon offsetting projects around the globe – take a look at some of our projects.

Transitioning to net-zero is no doubt a challenging journey but nonetheless has many benefits for both your organisation and the planet. Although your net-zero target may be far in the future, changes need to be brought in each year and not left to the end. Acting now means effective action your organisation can improve efficiencies, reduce costs and drive innovation. Having science-based targets that are verified by the SBTi shows to key stakeholders that your net-zero targets are credible and align with the latest science. With effective communication of your net-zero strategy, you can build reputational and competitive advantage.