Setting Net Zero Targets: Who Should be Involved in The Process?

The pursuit of a net-zero future hinges on actionable targets. Seamlessly transitioning from methodologies to impactful goals, Net0's latest article dives into the intricate process of setting net-zero targets. By aligning our efforts with transparent strategies, we unlock the potential to drive lasting change across industries.

As we continue to empower ourselves with knowledge and drive, let's explore how understanding methodologies paves the way for crafting meaningful net-zero targets.

In recent years, there has been a lot of discussion about net zero targets - what they are, how to achieve them and who should be involved. Net zero targets involve reducing GHG emissions to the point where the amount of global emissions released annually is equal to the amount of greenhouse gases that can be absorbed by trees, soils and other natural systems. Though there is still discussion as to who should be held accountable for creating and meeting these goals, it's obvious that we all have a role to play if we want to make substantial strides in the battle against global warming.

What are net zero greenhouse gas emissions?

Net zero GHG emissions refer to the balance between the amount of greenhouse gases released into the atmosphere and the number of greenhouse gases removed from the atmosphere. To achieve net zero global GHG emissions, the amount of greenhouse gases released must be balanced by an equal amount of greenhouse gases removed. This can be done through a combination of reducing carbon dioxide and implementing measures to remove greenhouse gases from the atmosphere, such as reforestation and carbon capture and storage.

Net zero emissions ?is a goal that many governments, organisations, and businesses are working towards in order to mitigate the negative impacts of climate change. By achieving net zero GHG emissions, it is hoped that the global temperature can be stabilised and the worst impacts of global warming can be avoided.

What are net zero emissions targets?

Net zero targets are goals that countries, organisations, or businesses set to achieve net zero GHG emissions. These targets can be set at various time horizons, such as 10, 20, or 50 years in the future. Some examples of net zero targets include:

• The Paris Agreement, an international treaty signed by 197 countries, aims to limit global warming to well below 2°C above pre-industrial levels, with an ideal target of limiting warming to 1.5°C. This requires the global economy to reach net zero emissions by the second half of the century.
• Many countries, including the United Kingdom, Canada, and Japan, have set their own national net zero targets for 2050 or earlier.
• Many businesses and organisations have also set their own net zero targets, often with the goal of aligning with the Paris Agreement.

Net zero targets are an important part of efforts to mitigate climate change, as they provide a clear goal to work towards and help to guide policy and action. However, achieving these targets will require significant effort and investments in low-carbon technologies and practices, as well as?changes to individual and societal behaviour .

Benefits of net zero target setting

Net zero emissions targets offer a range of benefits, including:

• The ability to mitigate the negative impacts of climate change by?reducing GHG emissions ?to a level that is no longer contributing to global warming.
• An incentive for businesses and individuals to adopt low-carbon technologies and practices through the pursuit of innovative emission reduction strategies.
• A means of monitoring progress towards reducing carbon dioxide and limiting global warming.
• Enhanced?communication and collaboration ?among various sectors in the pursuit of emission reduction objectives.

Who should be involved in setting and achieving net zero emissions targets?

There is ongoing debate surrounding the responsibility for setting and achieving net zero targets. While some argue that governments should assume this responsibility, others believe that businesses and individuals also have a role to play.

There are several advantages to involving businesses and individuals in the pursuit of net zero emissions targets. Businesses, for example, have the capacity to innovate and identify new ways to reduce their GHG emissions. They can also work together across sectors to share best practices and ideas. Individual citizens can also make a significant contribution through the reduction of their own carbon dioxide emissions and the advocacy for change.

Governments can facilitate cooperation between all sectors, but ultimately, the participation of all stakeholders will be necessary to make meaningful progress in limiting global warming.

In order to set realistic and effective net zero targets, it is important to consider the specific roles and responsibilities of each player in the ecosystem. This is because achieving these targets requires a comprehensive,?cross-sectoral transformation , which may be difficult to achieve without coordination.

The top-down approach: governments and climate pledge programs as mediators

Achieving net zero emissions at the governmental and regional level can be a complex and challenging task. It requires a comprehensive, cross-sectoral transformation, which may be hindered by supply chain complexity. In addition, the implementation of a reduction action plan may necessitate changes to existing legislation, as well as the creation of new communication channels to facilitate coordination and cooperation in the measurement process. Overall, the successful pursuit of net zero emissions goals will require?strong leadership , clear direction, and effective collaboration among various stakeholders.

It is important not to underestimate the potential of the public sector to accelerate decarbonisation efforts. As McKinsey reports, based on collected data on government spending from the G20 countries:

Public-sector spending accounts for 47% of GDP in the European Union, 44% in the United States, 39% in Japan, and 18% in India. Reducing public-sector emissions could be a vital component of most national decarbonisation strategies. Public-sector entities could help to scale up solutions and to increase demand for low-carbon products and services by including their supply chains in decarbonisation efforts.

Organisations in the public sector that have created a greenhouse gas inventory are better suited to take part in decision-making and formulating standards for other stakeholders. As such, the development of a reliable?carbon accounting system ?is a crucial prerequisite for achieving net zero emissions at all levels of governance.

Climate Pledge Programs (UN Global Impact, UN Race to Zero Campaign, C40 Cities, The Climate Pledge, SME Exponential Race to Zero, etc.) can play an essential role in sharing best practices and stimulating investment in the development of low-carbon products and services. Net zero emissions targets can serve as a valuable resource for leaders as they develop?carbon reduction plans ?that align with existing?reporting ?requirements. In addition, these targets can provide guidance for the implementation of relevant policies. Furthermore, they serve as a central hub for the sharing of knowledge and the pooling of collective efforts, facilitating the exchange of experiences and best practices among stakeholders.

With the collaboration of public institutions, businesses, and individuals as well as NGOs, we can create climate pledge programs that provide concrete goals to accomplish our environmental objectives.

The bottom-up approach: individuals and communities leading the way

The growing trend of individuals and communities setting net zero targets reflects an increased awareness and desire to take responsibility for their actions and mitigate the impacts of climate change. This trend is likely driven by the increasing accessibility of information about environmental issues and the direct impacts of climate change on individuals and communities. The influence and potential for individuals to effect positive change should not be underestimated.

According to a study by Nielsen, 66% of global consumers are willing to pay more for sustainable goods, and 56% said they would switch to a brand that is associated with a good cause.

The younger generations are leading the charge on this trend due to their heightened sense of social responsibility and commitment to environmental causes. In fact, 91% of millennials say they would switch brands to one that is associated with a good cause.

Net zero targets are being achieved in many inspiring ways. For instance, individuals and communities have set the bar high by leading the way with examples such as:

• The city of Berkeley in the US, which has committed to becoming carbon neutral by 2045
• The UK village of Tyndallton, which has set a target of net zero emissions by 2030
• The Canadian town of Hudson, which has set a target of net zero emissions by 2050

Evidently, net zero targets can vary from towns to cities and even individual households. This demonstrates the potential for attaining this goal on a large or small scale.

The role of businesses in the transition to a net zero economy

Businesses ?are key actors in the transition to a net zero emissions economy, given their significant contribution to global emissions and their ability to effect change through both policy advocacy and operational improvements.

Here are some ways that businesses can support the transition to a net zero economy:

• Reduce energy use and switch to renewable energy sources
• Implement energy efficiency measures in their operations
• Use low-carbon materials and adopt sustainable supply chain practices
• Invest in and develop low-carbon technologies
• Offset remaining carbon dioxide emissions through?carbon offset ?and carbon capture projects
• Engage in policy advocacy and support the development of supportive regulations and incentives for low-carbon development
• Communicate their efforts and progress towards net zero emissions to stakeholders, including customers, investors, and employees.

Leading businesses ?are already taking action on climate change, and there is a growing number of companies setting science-based targets for emissions reduction.

As of December 2021, the?Science Based Targets Network (SBTN) ?has approved the science-based targets of over 1,600 companies. The SBTN is a collaboration between the UN Global Compact , the?World Resources Institute (WRI) , the?World Wide Fund for Nature (WWF) , and?CDP ?(formerly the Carbon Disclosure Project), and it works with companies to set and implement science-based targets for reducing their carbon dioxide emissions.

In addition to the companies that have set science-based targets through the SBTN, there may be other companies that have set their own science-based targets or that are working towards science-based targets initiative settings in some other way.

Examples of companies that have set science-based targets

1. Unilever ?is a multinational consumer goods company that has set a science-based target to reduce its greenhouse gas emissions by 50% by 2030, based on a 2018 baseline. The company is also committed to sourcing 100% of its electricity from renewable sources by 2030.
2. eBay ?is an e-commerce company that has set a science-based target to reduce its carbon dioxide emissions by 80% by 2035, based on a 2019 baseline. The company is also committed to offsetting any residual emissions through carbon offset projects.
3. Ikea ?is a multinational home furnishings company that has set a science-based target to cut its GHG emissions by 70% by 2030, based on a 2016 baseline. The company is also committed to sourcing 100% of its electricity from renewable sources by 2030.

How can Net0 help businesses to set and achieve net zero emissions targets?

Businesses need help to set and achieve their net zero targets, and?carbon management platforms ?like Net0 can play a significant role in this process.

Setting net zero targets, committing to achieving them by implementing?sustainable strategies , tracking the progress and reporting on carbon reduction can be a complex and time-consuming process. However, by using automated tools such as Net0, businesses can make this process simpler and more efficient.

Game-changing Net0 features for businesses

Net0 provides a cloud-based platform that businesses can use to?track and manage ?their emissions. The platform includes a wide range of features, with the following being particularly useful for setting and achieving climate goals:?

• Carbon simulator: by using Net0 software, businesses can simulate how different factors, such as operational changes or switching to renewable energy sources, can impact their carbon emissions reduction. The software also allows businesses to?track their progress ?towards their carbon reduction goals.

• Financial simulator: by using Net0, businesses can simulate the financial impact of reducing their carbon emissions by analysing their current emissions data and?setting reduction goals . This allows businesses to make informed decisions about investing in sustainability efforts and demonstrates a commitment to reducing their environmental impact.
• Benchmarking: by using Net0 to monitor carbon performance, companies can track their carbon emissions and see how they compare to industry benchmarks. This allows them to set goals for reducing their emissions and make more sustainable business decisions.

• Action cards: with Actions functionality, businesses can assign specific emission reduction tasks to team members and track progress towards meeting overall carbon reduction goals. This helps ensure accountability and efficiency in reaching those goals.

• Progress tracking: by using Net0, businesses can track their progress in reducing carbon emissions and easily share this information with stakeholders via public dashboards.This transparency helps to build trust and accountability within the company and the larger community.

The role of suppliers across the supply chain network in setting targets and transitioning to net zero

Suppliers have a vital role to play in the setting of net zero targets and the transition to a net zero economy. In particular, they can help businesses to understand their emissions footprint and set ambitious yet achievable reduction targets.

Here are four ways in which suppliers can support businesses in their transition towards net zero emissions:

1. Offer low-carbon products and services: Suppliers can support businesses by providing products and services that have a lower carbon footprint. This could include offering energy-efficient products, renewable energy solutions, or sustainable transportation options.
2. Provide information and support: Suppliers can help businesses understand the carbon impacts of their products and services, and provide guidance on how to reduce those impacts. This could include providing data on the carbon footprint of products, offering carbon offset and carbon capture options, or providing training and resources on sustainability best practices.
3. Collaborate on sustainability initiatives: Suppliers can work with businesses to?identify and implement sustainability initiatives ?that help to reduce GHG emissions. This could include developing and implementing energy-efficient processes, sourcing renewable materials, or participating in joint sustainability projects.
4. Set and communicate sustainability goals: Suppliers can demonstrate their commitment to sustainability by setting and communicating their own net zero or sustainability targets. This can help to encourage businesses to adopt similar goals and can also help to build trust and credibility with customers.

Examples of companies working with suppliers to get to net zero

There are many companies that have started working with their suppliers to achieve net zero targets:

• Patagonia ?is a global outdoor apparel and gear company that has set a target to become carbon neutral across its entire value chain by 2025. To achieve this goal, the company is working with its suppliers to reduce their emissions and is also investing in renewable energy and carbon offset and carbon capture projects. Patagonia has also committed to using 100% renewable energy in its own operations by 2025.
• Mars ?is a global food and pet care company that has set a target to become carbon neutral by 2040. With the aim of achieving this target, the company is teaming up with its suppliers to aid them reduce emissions. Mars has also launched a Supplier Sustainability program, which provides support and resources to help suppliers cut emissions.
• Nike ?is a global athletic footwear and apparel company that has set a target to become carbon neutral across its entire value chain by 2050. To achieve this goal, the company is working with its suppliers to reduce their emissions and is also investing in renewable energy. Nike has also committed to using 100% renewable energy in its own operations by 2025.

Climate-smart software for collecting supplier data

According to the CDP,?Scope 3 emissions , on average, account for approximately 80% of a company's total carbon footprint. As such, it is essential for companies to collect data from their suppliers and business partners to accurately set targets for reducing their carbon emissions. However, some executives may view the process of collecting and analysing?Scope 3 data ?as a significant obstacle to implementing carbon accounting. The use of AI-powered data analysis can greatly facilitate this process.

“AI’s unique capacity to gather, complete, and interpret large, complex data sets [that] can help stakeholders take a more informed and data-driven approach to combat carbon emissions and addressing climate risks.” - Hamid Maher, managing director and partner at BCG and BCG GAMMA, and a co-author of the AI For The Planet Report.

Business leaders charged with taking action on AI and the environment realise that Artificial Intelligence will be critical in overcoming our climatic difficulties.

“A research carried out by the Drax Group [...] revealed that 85% of the key decision-makers in the manufacturing sector consider data analysis a top priority within the plan for reaching net zero, but fewer than half (42%) cited a lack of data analysis knowledge within the business as a barrier to implementing the needed change.” - EPTDA (Leading Executive Association For Power Transmission Motion Control)

EPTDA, the leading European network of 230 vendors and suppliers across Europe, the Middle East and Africa, strongly encourages executives to rapidly embrace automation for a smoother transition.

Benefits of AI

The network highlights the importance of using artificial intelligence-powered data measurement and analytics in the supply chain, specifically:

• To provide end-to-end visibility, allowing factory leaders to identify key carbon drivers and make informed decisions about where to allocate resources.
• To achieve data transparency by collecting and processing all relevant data to establish a baseline for analysing trends in reliability, cost, and environmental performance.
• To evaluate various baseline risk characteristics, allowing companies to assess the potential impact of proposed changes to processes and sourcing strategies.
• To identify opportunities for improving key performance indicators (KPIs).

How can Net0 help to collect emissions data from suppliers??

Net0’s software addresses the need for speed, transparency, and collaboration in data collection by providing a platform that is easy to use, quick to implement, and that offers real-time visibility into progress for all players in the supply chain.

Net0’s vendor outreach programme allows businesses to effectively communicate with vendors,?collect data ?in a structured and efficient way and invite suppliers directly to the platform to collaborate when it comes to creating effective strategies.

Net0's platform enables reporting entities to onboard thousands of vendors throughout their supply chain. In this way, companies can outsource parts of the carbon accounting process. Instead of one person being responsible for all management, it makes the data collection a collaborative process. However, the software can be utilised either way to suit your preferences.

What is more, Net0 sends automated reminders to vendors so the reporting company can obtain accurate scope 3 data for an?activity-based carbon accounting methodology ?at a granular level. Real-time access to GHG inventories and reports enables the company to provide full transparency and track its progress easily.

How can businesses and governments get started with Net0?

Net0 helps large businesses and governments become carbon neutral by providing an easy-to-use, fully automated solution. Net0’s comprehensive software enables emissions measurement and reduction planning, one-click carbon offsets fore residual emissions, stakeholder reporting and regulatory?compliance.

If you are interested in exploring?automation ?for your climate management efforts and reducing emissions, we invite you to?schedule a demo ?of Net0's software. Our platform is user-friendly and allows for the efficient collection of data from suppliers. It provides real-time transparency into progress across the supply chain and is designed for easy implementation.

Final thoughts

Climate change mitigation efforts require the participation of governments, businesses, suppliers, and consumers. Governments must establish frameworks for businesses to operate within, set emissions reduction targets, and implement policies that encourage sustainable business practices. Businesses must evaluate their carbon footprint and implement strategies to cut carbon emissions. Suppliers must provide products and services that contribute to reducing greenhouse gas emissions, while consumers must be conscious of the environmental impact of their purchasing decisions. By collaborating, we can create a more sustainable future.

Book a demo ?with Net0 today and talk to an expert about how we can assist you in meeting your carbon reduction objectives.

This article has been adapted from?the?original article ?published on net0.com

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