This article was originally published in the BSR Insight.
While more than 3,000 businesses have joined the UNFCCC Race to Zero campaign and pledged to reach net-zero greenhouse gas (GHG) emissions by 2050, many companies face challenges in putting this guidance into practice.
Wipro is a founding member of Transform to Net Zero, a cross-sector industry initiative to accelerate the transition to an inclusive net-zero global economy. Our 2025 goal is for 1,000 Fortune Global companies to adopt targets backed up by transformation plans to achieve net-zero emissions no later than 2050.
To advance robust net-zero goal setting, Transform to Net Zero’s new Transformation Guide will share how three Transform to Net Zero members — Danone, Wipro and Environmental Defense Fund (EDF) — approached a net-zero goal-setting process that translates into meaningful business transformation.
Below are five steps of how your organization can navigate the net-zero goal-setting process and commit to meaningful emission reduction targets.
Step 1: Understand your emissions
Every company’s decarbonization journey begins with a comprehensive value chain GHG baseline and footprint assessment. Knowing your footprint allows you to set net-zero targets, but it is often easier said than done, especially with regards to Scope 3 emissions, which are often the lion’s share of a company’s emissions.
Scope 1 and 2 emissions are relatively straightforward to account for because they are derived directly from company operations and therefore within the direct control of a company to remediate. Scope 3 requires accounting for your entire value chain, much of which is outside your control either upstream or downstream, which make Scope 3 emissions a tough nut to crack.
Measuring Scope 1, 2 and 3 emissions are nevertheless a crucial first step in developing an accurate net-zero roadmap that demonstrates credibility to investors, customers, civil society and other stakeholders. Amidst increased scrutiny of corporate net-zero targets, it is imperative that this accounting of your carbon footprint is reliable and transparent.
Step 2: Set an ambitious net-zero goal with clear interim milestones
Every company needs a north star commitment when it comes to emissions. For instance, Wipro has committed to net-zero GHG emissions by 2040, with a 55 percent reduction in GHG emissions by 2030. But making a commitment is not enough. Publishing a detailed plan explaining how you will get there is a major component as well. In an era where credibility is paramount, you must show your work.
Creating and publishing a detailed roadmap accounting for every facet of your emissions with interim milestones will enable you to track and share your progress toward net zero.
That means sharing key details regarding each phase of your GHG mitigations, including direct emissions (company facilities and vehicles), indirect emissions (purchased electricity, good and services), and yes, your value chain too (waste, transportation, business travel, employee commuting and all downstream lifecycle activities related to your products and services). Creating and publishing a detailed roadmap accounting for every facet of your emissions with interim milestones will enable you to track and share your progress toward net zero with key internal and external stakeholders.
Step 3: Engage with leaders to create and sustain organizational buy-in
Decarbonization doesn’t happen instantaneously. It’s a long process that requires the buy-in and support of many people over a period of many years. In the beginning, your leadership must be onboard because decarbonization requires major operational changes through your organization. Wipro has been working on decarbonizing its value chain for more than 15 years. Initially, the focus was on socializing with leadership the idea of developing a strong climate change program and obtaining consensus on commitments to the necessary investments and resources. Over time, this process matured into a common shared understanding throughout the company of the need to constantly improve our net-zero and sustainability work.
Step 4: Collaborate with suppliers and employees on meeting the Scope 3 challenge
Achieving net zero is not possible without tackling Scope 3 emissions, which by definition are not under the company’s direct operational control. For many companies, measuring and ultimately eliminating Scope 3 emissions offer the greatest potential GHG reductions, so it’s an incredibly worthwhile, albeit difficult, task. For example, 75 percent of Wipro’s emissions in FY21 are from Scope 3 sources, with business travel, employee commute and purchased goods/services comprising a significant proportion.
To help reduce your Scope 3 emissions, consider adopting some of the following strategies:
- Work with local transport authorities to improve access to public transport for employees
- Increase carpooling by employees
- Develop robust processes to promote remote working and collaboration
- Reduce business travel, in particular air travel
- Increase the lifecycles of your products and their end-of-life treatments
- Reduce the waste generated by your organization as much as possible
In addition, work with suppliers directly through industry associations to decarbonize purchased goods, such as IT hardware, telecom and other business services. Your suppliers must be a key part of your reduction strategy because they most likely contribute most of your value chain’s emissions.
Step 5: Partner with customers
The GHG emissions of the IT services sector tend to be relatively lower than more carbon-intensive industry sectors. For B2B businesses, while reducing your own value chain emissions to net zero is a significant contribution, you can also play an equally important role in helping customers reduce their own GHG footprint with the help of the right technology solutions and expertise. Organizations around the world are all facing the net-zero imperative, and your organization’s experience planning and executing a net-zero commitment is valuable and important. Share it with your customers. While many of the world’s largest companies have net-zero commitments, even more do not. It is essential that more and more organizations join the drive to net zero, and by sharing your story with your customers, you make their own journey that much more palatable.
Source: GreenBiz
