The terminology around carbon ambitions has undergone several changes over recent years as ‘climate change’ has been upgraded to ‘climate emergency’. New language can indeed help better shape aspirations and rally support but definitions have changed too and cannot be used interchangeably. Before we meet the Net Zero challenge, we need to understand what that ambition means.
Carbon Neutral means that a company, product, city or state is balancing out the carbon emissions that it creates by funding (‘offsetting’) an equivalent amount of carbon savings elsewhere. Such efforts can include financing renewable, energy efficiency or reforestation projects but the organisation does not need to be actively reducing its own emissions footprint.
Net Zero takes this further. To claim this status, businesses, products and local jurisdictions must ensure that they remove as much carbon as they emit. There are two main strategies: reducing carbon emissions by switching to renewables and increasing energy efficiency and removing them, for example by large-scale tree-planting or carbon usage and storage.
Carbon Negative involves going beyond this to the point where the organisation, authority or geographical territory is removing more carbon than it emits. This is dependent on developing and scaling up technologies that can enable large-scale removal of carbon emissions: such as bioenergy with carbon capture and storage, where plants are grown for energy generation and the resulting carbon emissions are stored, or Direct Air Capture, which removes CO2 from the air. Timelines: Many targets for Net Zero aim at 2050, though there is increasingly a push for targets, particularly for individual businesses, to be more ambitious. The date is rooted in the UN Intergovernmental Panel on Climate Change report of October 2018, which found that limiting global of 1.5C above pre-industrial levels would mean that global net human-caused emissions of carbon dioxide would need to fall by 45% from 2010 levels by 2030 and reach Net Zero 20 years later. Given the technological leaps required for delivery, very few organisations or governments are wholly on target for these dates.
Meeting Net Zero is a collaborative exercise. Keeping apace of innovative strategies and products from across markets and different sectors will be crucial in maintaining business performance and meeting regulatory requirements. In developing this report, colleagues and clients from across Hanover have shared insights from different markets and sectors on meeting the Net Zero challenge, and seizing benefits ranging from increased staff engagement and retention, to greater operating efficiency and broadened and more meaningful customer relationships. We explore how business can and should be tying decarbonisation and sustainability into corporate strategies, political engagement and communications.
We start by setting out the context and scale of the Net Zero challenge and what it means for business. All industrial processes, and therefore all product supply chains, will be impacted by the chosen strategic vision for rapid decarbonisation. The technology in our homes, the clothes we wear, the food we eat, even how our financial products are designed by our bank, will all have been considered in the route to Net Zero. How individuals go about their day to day lives will be fundamentally altered by how we choose to structure a green economy.
Next, we investigate how this shared challenge is being approached across different markets and how different geographies offer varied opportunities and issues for those moving towards a decarbonised economy.
Delving deeper into the nature of the challenge, we explore where companies can learn lessons from other sectors. Companies including Sky, Apple, H&M Group, Novo Nordisk and Facebook outline different approaches to the challenges of decarbonisation and sustainability.
This section explores why and how brands find purpose; the role of green finance and the influence of shareholders; whether today’s ‘waste’ is the critical resource of the future; and how you can engage suppliers and customers in your emissions reduction plans. It also investigates how healthcare companies address the dual challenge of reducing their manufacturing carbon footprint, while increasing production of new solutions to tackle climate related disease, and how technology companies balance the benefits of big data and digitalised ‘smart’ solutions with the emissions impacts of data centres.
We also explore the concept of companies operating with purpose, with data from our Insights team showing that demonstrable company values are fundamental to attracting and retaining talent, and we look at a case study of a business structured around environmental goals.
Finally, we consider the role of good communications in driving change. This includes a case study of a client campaign where an NGO partnership elevated existing multi-platform public outreach, and our thoughts on how the Extinction Rebellion campaign can be taken to the next level.
