Landsec updates carbon targets to align with SBTi’s Net-Zero Standard
EXCLUSIVE: Real estate firm Landsec has updated its carbon reduction targets to align with the Net-Zero Standard from the Science Based Targets Initiative (SBTi).
The SBTi’s Net-Zero Standard opened to corporates in January 2022 as the world’s first science-based certification of companies’ net-zero targets. The certification is given to businesses if their decarbonisation strategies are in alignment with the Paris Agreement’s goal of keeping planetary warming to 1.5C.
The SBTi has clarified that science-based net-zero targets will require companies to achieve deep decarbonisation of 90-95% before 2050. From that point, companies should aim to neutralise unavoidable emissions through offsets and removals. Crucially, the SBTi states that carbon offsetting and removals cannot exceed 5-10% of a company’s emissions, although this is sector dependent.
Landsec has revealed to edie today (9 March) that it has now updated its carbon targets to align with the Net-Zero Standard.
Landsec has committed to reducing direct and indirect emissions by 47% by 2030 from a 2020 baseline. This target will build towards a long-term goal of reaching net-zero by 2040, delivering a 90% reduction in absolute emissions from a 2020 baseline. The SBTi has approved the targets.
Landsec’s head of ESG and sustainability, Jennie Colville said: “As we transition to a low carbon economy, transparency and consistency are key to ensuring businesses are taking the right actions that are aligned with the goals of the Paris Agreement. We’ve made great strides forwards since science-based targets were first introduced, but the lack of a common definition of net-zero has meant targets have been inconsistent which has ultimately undermined the credibility of corporate net-zero goals. Having a clear methodology aligned with the climate science and a robust process for validating targets will help companies make meaningful progress towards reaching net-zero.
“Revisiting our own science-based targets has allowed us to further challenge ourselves and gives us a clear framework for success. The path to net-zero won’t be easy, but by working with our customers, supply chain and the wider industry there is a real opportunity to build a greener, fairer society.”
In 2016, Landsec became the first commercial real estate company in the world to have its carbon emission target approved by the SBTi. Having met these initial targets 11 years early, Landsec announced in 2019 that it intended to become a net-zero business. It then outlined plans to cut Scope 1 (direct), Scope 2 (power-related) and indirect (Scope 3) emissions from downstream leased assets by 70% by 2030 against a 2014 baseline, and had these targets verified in line with 1.5C by the Science-Based Targets Initiative (SBTi).
In 2021, the company launched a transition plan to deliver these emissions reductions, backed with £135m of new funding. Funding was prioritised for reducing operational energy use using a mix of technology (artificial intelligence and building energy management systems) and behaviour change engagement with customers; installing low-carbon heating systems including heat pumps and scaling up onsite renewable electricity generation.
The company has today also announced the pricing on an inaugural green bond, valued at £400m.
The £400m green bond comes with a maturity of 9.5 years and will help the company deliver against its sustainability targets. The green bond was announced following the publication of Landsec’s updated Green Financing Framework
Landsec’s chief financial officer Vanessa Simms said: “I am delighted to be issuing our first Green Bond, illustrating Landsec’s continuing green leadership credentials in the real estate sector.
“The transaction clearly demonstrates Landsec’s ability to access competitively priced capital in more challenging market conditions and, as a result, Landsec remains well placed to perform as the economy transitions to a higher interest rate environment.”