How Can Businesses Achieve A Future Of Net-Zero Emissions?
Climate has been witnessing one of the most dramatic changes of all times with rising ocean levels, melting glaciers, increased CO2 levels, declining wildlife and aquatic life with many species of plants and animals even becoming extinct. This alarming impact is a result of global warming, which if not controlled, will further deteriorate living conditions on the planet tremendously.
Amidst this crisis, climate action has been gaining grounds all across the globe as individuals, corporates and countries alike are becoming increasingly conscious of their carbon footprints and its disastrous effects on the planet. The effect of climate crisis is now visible all around us. Climate conversations are now structured and the world has moved from assuming it to be just another money making business farce.
Much of the increasing focus on climate activism can also be attributed to the COP meets over the years wherein participating countries have been taking pledges & commitments to rehabilitate Earth which has increased the awareness on climate crisis manifold.
The recent COP26 further placed climate action on a pedestal as many countries released their net-zero targets to arrest global warming and stabilize climate change. In one of the most significant announcements at COP26, India pledged to achieve net-zero emissions by 2070.
Feeling the Heat
Though the pledges have significantly impacted climate action across the globe, the tread towards a sustainable future has been slow and still needs momentum.
While businesses are increasingly feeling pressured to become climate conscious, they still lack clarity on starting their climate journey with a well-defined action plan. A thorough understanding of climate risks is still amiss amongst a vast majority. Consequently, a lot of global and Indian brands are yet to join the bandwagon and become catalysts of climate change.
Some companies may have defined climate action in their governance but their steering mechanisms for comprehensive climate strategies and emission reduction targets are not well aligned with the Paris Agreement. Their corrective measures continue to largely remain insignificant while the heat for the need of a strong climate activism continues to build up.
How can businesses contribute to climate change?
Net-zero is a state in which the planet’s greenhouse gas emissions are balanced by absorption or removal. Though scientifically, emissions cannot be zero, the aim is to ensure that all the current emissions are balanced by removals and sequestrations. For this, businesses must implement a well-defined strategic plan that is based on important approaches.
Businesses should first spend time on assessing climate-related risks, the scale of necessary emission reductions, and the levers that are key to achieving them. A systematic and strategic roadmap for a long-term climate journey should be designed basis the deeper understanding of climate nuances. This action plan must be included in the governance structure of businesses.
Before implementing the plan and commencing the journey to sustainable practices, businesses should allocate funds for climate budgeting basis their emission reduction targets. Once this is established, businesses should plan for the implementation of their climate positive best practices and strategies with the targets in mind.
One of the most important elements of an effective climate journey is to cap future carbon emissions, taking into account global emission reduction commitments. Companies should first derive their individual CO2 footprint and reduction targets and then design an action plan in line with their climate objectives.
Climate conservation is always a collective effort of all relevant stakeholders of a company. Educating all stakeholders of a company especially supply chain partners, customers, investors, board members and employees, on the importance of adopting sustainable practices is key to drive a target oriented action plan. Finally, businesses should track their climate action to evaluate the efficiency and accordingly plan for requisite corrective measures.
The must have elements of a climate action plan
Adopting climate best practices enable companies to not only enhance their brand value but also gain a competitive advantage in the market. Companies with a sustainable action plan can increase their productivity and make greater financial gains. A well-defined multi dimensional action plan can help companies to foster a sustainable long-term growth for business success. The most effective plan of action that businesses can adopt for a net-zero future must include essential levers.
Most importantly, it should enable businesses to effectively reduce their energy consumption and associated emissions. They should adopt efficient ways to reduce their energy usage and make it carbon neutral. Existing resources must be optimized and wherever possible, it should be replaced with renewables like wind, solar, biomass, green hydrogen, hydro, tidal and/or geothermal.
Businesses should adopt carbon offsetting measures like carbon credits to compensate their carbon footprint and GHG emissions with an equivalent reduction that comply with mandatory and voluntary binding caps.
Companies should implement Negative Emission Technologies (NET) like afforestation & reforestation, land management, bioenergy production, enhanced weathering, ocean fertilization et al. which play a prominent role in achieving net zero emissions.
In addition, businesses should adopt circular economy solutions like green cements, recycled plastics, circular fashion, and up cycling of vehicles powered by 100% renewables that limit environmental impact and wastage of resources while increasing efficiency at all stages of the product life cycle.
A future of net-zero emissions
Net-zero targets are long-term. They may seem unachievable but a well-designed action plan can certainly take the planet closer to a more thriving future. There is an opportunity at every stage of a business - to rethink, recycle, refuse, reduce, re-use, repair, re-gift and recover.
Companies not only need to measure their exposure to climate-related risks and subsequently manage them, they must incorporate climate change in their strategic plans. Failure to do so will undermine the sustainability of their own business soon.
One needs to be mindful of their relationship with Earth in every day life. Businesses should become conscious of their responsibilities and obligations to the planet or soon, very soon it may just be too late for any action or reaction and of course there is no Planet B!
(About the author: Manish Dabkara is CMD & CEO of EKI Energy Services Ltd.)
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