What makes a great net-zero business strategy?
What are sustainability leaders from some of the biggest names in business doing about their net-zero plans? Following his recent workshop, Re_Set Director of Sustainability, Rick Benfield, shares the thinking.
Actions speak louder than words. This has never been truer than when it comes to net zero. Post COP26, pledges and promises abound, but the question for leaders now is how to ensure these ambitions are effectively turned into actions.
This was one of the topics being discussed in detail by some of the biggest names in business at edie's SPARK! workshop events, hosted in Birmingham on 30 November. Hosted as part of Edie’s Net-Zero November campaign, the event enabled energy and sustainability changemakers to connect, collaborate and seize the moment of net-zero.
Joining me on the panel were sustainability experts from companies including Currys, CBRE and Grosvenor. The discussion was open, collaborative and there was broad agreement that, when it comes to achieving net-zero, no business is yet an expert.
And that’s OK. It makes it an exciting time, as experts from a range of sectors all look to learn from each other as they begin to develop and shape their net-zero plans.
So, how are these businesses planning to move from ambition to action? Below are the key areas we discussed on what leaders should be focused on.
What are the key components required for a great net-zero strategy?
1) Understand your future footprint
While it is important to understand past emissions and current track record, there is a risk that this is an approach that just chips away at the problem. Instead, we believe companies must make forward-looking projections of their emissions and tie them to their business strategy and growth plans. As an example, as part of developing the Primark Cares sustainability strategy, Re_Set worked with Primark to develop a projection profile for 2030 in line with ambitious business growth targets.
2) Align your ambitions with science-based targets
There is now a range of industry-accepted targets which can be used to lock in ambitions. Much like skipping the future projection profile above, if you’re using weaker definitions of net-zero, this can lead to accusations of greenwashing. The SBTi’s Net-Zero Standard, for example, is the world’s first framework for corporate net-zero target setting in line with climate science.
3) Embed net-zero into your wider company strategy
Like sustainability more broadly, we believe net zero cannot just be a bolt-on. It is important to identify the key operating model changes needed to deliver on net-zero targets. For larger manufacturing companies this can be a significant undertaking and needs to be integrated into mature lean processes and customer journeys.
4) Apply laser focus to your supply chains
These will make or break your ambitions, so it is crucial to give suppliers support and guidance There is a significant amount of collaboration and sharing of knowledge across industries on how to implement a net-zero strategy, which is helping suppliers to learn from each other.
5) Avoid, Reduce, Innovate
When identifying solutions and preparing your net-zero roadmap, we recommend thinking about three levers that can be used to keep on track. First, Avoid by changing designs and incorporating carbon into your decision-making process. Secondly, Reduce, by utilising efficiencies and switching to renewables. Finally, Innovate: through collaboration in green finance, cleantech and wider movements such as regenerative agriculture.
6) Convince the board
CEOs and boards need to understand the size of the challenge to achieve net-zero. To do this well requires a significant transformation, driven top-down and embedded across the organisation. Consider establishing net zero as a standing agenda item at executive level, assign management oversight of net-zero transformation, and evaluate net-zero incentives structure. Danone started tying their managers’ bonuses to carbon reduction targets way back in 2009. What can you do?
7) Be transparent
As with any major change programme, communication is key. Share your strategy, both internally and externally, plus the milestones that have been committed to be delivered.
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Rick Benfield is the Director of Sustainability at Re_Set, a leading next-generation strategy consultancy for innovation and sustainability. Re_Set is powered by innovation intelligence platform Springwise. Sign up to the Springwise Sustainable Source newsletter to receive a bi-weekly curation of green innovations, or contact the Re_Set consultancy team to learn how innovation could help accelerate your business.Springwise