Our Net-Zero pledge is one year old

Today we are celebrating the one-year anniversary of our pledge. One year ago, at that same time, I was clearly much more stressed than today, as we were at the start of a new adventure.?

I would like to first come back to how we got there.?

I regularly get asked how I managed, less than a year after my nomination as CSO, to sign the Business Ambition for 1.5 with intermediate targets validated by SBTI, and how difficult it was to achieve it.?

Well, let’s kill the suspense immediately; it was certainly one of the hardest things I have ever had to manage in my career.

I will now go back to the beginning of the journey and I hope that along the way you will find one or two tips that you might find useful.?

It all started quite classically, by a workshop. This was pre-Covid time, so we were about 70 people from all horizons, all functions, all geographies, for three days trying to figure out the next step of our already 30 years old sustainability journey.

And of course, when you ask 70 people to rethink the purpose of a company, a certain magic happens, and before you know it we all agreed that there is no time for small steps and the only thing acceptable is a net-zero pledge.? The ambiance was electric!

And then waking up the next day, when the excitement has come down, to realise the challenge in front of us, it is hangover time.

People are clearly motivated, but we must channel all this energy, organising the teams in small groups with the right focus. It is then important to have each expert group focus on their task, while ensuring we are not creating silos.?

We looked of course at what was done in the industry, to realise that we would be the first one to develop a net-zero roadmap for cement, and that there was no existing model. So the first difficulty was to establish it and who better than SBTi could we partner with.?

The first work concerned the traditional levers. We had already reduced 27% our CO2 intensity since 1990 and had a good clinker factor and fuel replacement rate, but how far can we really push them? The good news about the traditional levers is that we know them very well. The bad news is that we know them too well.?

Producing cement is an energy-intensive process. Two factors have the highest impact on carbon emissions - fuels to heat the kiln, and the so-called clinker factor (the percentage of clinker in cement): On the first factor, effectively, we know that we can replace fossil fuels used to heat the kiln to 1450 deg and responsible for about 30% of the CO2 by alternative fuels such as biomass. Some plants are already running at 100% replacement. Part of the equation is that it requires a good waste stream chain, the right legal framework, and that some countries will be slower to reach that result. This means that when we do our bottom-up approach, people struggle to see all roadblocks lifted soon and tend to be very conservative in their estimates. The same phenomenon happens when we discuss the second traditional lever, which is the reduction of clinker factor.?

A good strategy, over a long period of time, should include some percentage of unknown to remain ambitious, which is very difficult when the topic is well under control.

Based on the study we made with many countries, looking at historical data and at success factors, we established a model that shows that two traditional levers will allow us to reach our 2030 targets, and we will still have space to push them further later, but to reach zero, we will need innovation, novel cements and Carbon Capture, Utilisation and Storage (CCUS).

And then it becomes more complex to forecast. Today, there are many studies done on the cost of the future technologies, but also, there are many people working on the technology, companies, startups, individuals, trying to make these technologies more efficient and cost less. So how do we include this data in the model??

And while we are at it, what will be the cost of CO2 in 2050? What will be the legal framework? How much CCUS infrastructure will be developed by governments? How do we build a model with so many unknowns?

“Simply” by establishing eight factors, with 2-3 levels each, from conservative to stretch, and studying the different possible combinations and the impact of each lever on the actual pledge. Ultimately, the real purpose is to check if, using a reasonable to pessimistic scenario, we can still make it and have enough confidence in our model to commit. Of course, using only credible references for the different assumptions such as IEA scenarios, a number technical studies, financial assessments and scientific papers.??

I will not describe here the hours, weeks and months of discussions, debates, weighting of each lever, each assumption. Just think of an iron (wo)man and you will get an idea.?

Then comes the approval period. Many people were involved in the making of the model, but even more were involved in the approving of it. We worked with the main business units to align on country targets, then the finance department to check the Capex and Opex assumptions, then the technical, innovation, procurement ... etc.?

In parallel, a very strong partnership was established with SBTi. It was important for us to collaborate with them to define and validate our 2030 target, as the first movers. The fact that this concluded into a full partnership to work on the net-zero pathway was a great conclusion of this work.?

And it is only once everybody was aligned, that I could finally present it to the Executive Committee and then to the Board of Directors. I had kept them informed periodically of the on-going work, but I knew that I had to show them scientific evidence that it was achievable to get their approval.??

I used a methodology, which I have developed over the years, which I would call the “Encirclement method”. I knew that many would turn to their team to judge the work done, whose teams would also turn to their teams ... etc. This was the purpose of the weeks of work involving everybody. Start convincing the countries, then the regions; the experts then the heads of departments, the research project managers then the head of innovation.? By the time I presented it to the EXCO, it was not the idea of a few people, it was a full-enterprise project.

I knew that the top management was supportive of sustainability, but I also knew that we were entering new ground with all the risks that this entails and I needed to convince all that we were mastering the topic.?

The next step is key, it is all about transforming the model, the scientific assumptions into something that can be communicated externally, and finding the right opportunity to announce it. It is a part that should not be underestimated and took another long period of time.?

On September 21st 2020, at the opening of the New York Climate Week, we announced how we were the first company in our sector to join the business ambition for 1.5-degree C with intermediate 2030 targets validated by SBTi.

It was certainly the most stressful project I ever had to lead, but also the most rewarding, not only because of the impact it had, but also for the team work and last but not least the overwhelmingly positive reactions from all employees and external stakeholders.?

One year later, the entire organization is engaged behind our goal. Our new identity portrays it the best: a global leader in innovative and sustainable building solutions. Merging sustainability and innovation at the EXCO has been another step towards it. We now have a roadmap per plant, approved by all, with a good dashboard and monthly KPI reporting. We accelerated the work we do on CCUS by adding another 10 pilots to our portfolio. Our strategy won the Edie award for the best sustainability strategy work.

Our work with SBTi to continue refining? the roadmap has been very fruitful and all details will be out soon, when we will issue our first climate report as we committed in the context of the “climate action” initiative, to put our sustainability transition to a vote by our shareholders.?

This article is about the pledge only, stay tuned for the next one about our new nature strategy launched? at the IUCN summit and all the great work we do on human rights due diligence and positive social impact.

#ThisIsJustTheBeginning