This page covers the below sections:
- What is Net Zero for the UK?
- The Importance of Net Zero
- Voluntary Reporting Initiatives
- Key Initiatives for Businesses to Support
- Race to Zero Campaign
See Contents for all available Sustainability Hub pages.
What is Net Zero for the UK?
‘Net Zero’ means that the UK’s total greenhouse gas (GHG) emissions would be equal to or less than the emissions the UK removed from the environment.(1) Therefore, any emissions will be balanced by schemes to offset an equivalent amount of greenhouse gases from the atmosphere.
Best practice is to limit impacts and emissions as much as possible first. Significant cuts in emissions are essential as well as the restoration and protection of the natural environment. While offsetting may be considered as an option, it must be remembered that offsetting does not tackle the underlying causes of emissions.
The Importance of Net Zero
While everyone has a part to play, businesses are critical in the fight against climate change. With businesses facing growing regulatory pressure to reduce their emissions’ footprint, measurement and reporting are increasingly becoming major business matters. It is likely that if businesses are to succeed in the future, they will need to seize the opportunity to adapt to a low-carbon future, helping prevent the worst impacts of climate change and future-proof business growth.
Reporting of greenhouse gas (GHG) emissions is an important tool to help the UK’s transition to a low-carbon economy. It is the process by which an organisation measures and reports the volume of GHGs emitted that are associated with that company’s activities.
Measuring GHG emissions is the first step any business takes to managing them. Some companies have a legal obligation to report, however, it is important for companies to consider the advantages that reporting can deliver:
- Risk management: By reporting GHG emissions, as well as other environmental impacts, companies can identify and better understand their exposure to climate change risks and what can be done to mitigate against them. Reporting should be used to inform a company’s strategy of emission reduction.
- Trust and Reputation: Stakeholders are increasingly requiring disclosure of organisational environmental impacts. As expectations of transparency continue to grow, a company’s performance can differentiate it from its peers. Reporting also provides an opportunity to show year-on-year improvements. Reporting should be publicly disclosed.
- Financial Implications: Understanding and increasing the organisational awareness of consumption, spend and associated carbon emissions can help identify opportunities for improvements leading to operational cost savings. Driving behavioural change and improving insight into key areas for focus will make a more efficient business.
Companies should be transparent and clearly explain their inclusions, and exclusions, in preparing reports on their GHG emissions. There should also be a clear explanation of the methods used. One means of determining targets is to consider Science-Based Targets (SBTi).
Science-based targets provide a clearly defined pathway for companies to reduce GHG emissions. Targets are considered ‘science-based’ if they are in line with what the latest climate science considers necessary to meet the goals of the Paris Agreement.
Voluntary Reporting Initiatives
The GHG Protocol is a widely used international reporting tool and series of standards for businesses to understand, quantify and manage GHG emissions.
The Product Standard can be used to understand the full life cycle emissions of a product and focus efforts on the greatest GHG reduction opportunities.
The GHG Protocol defines direct and indirect emissions as follows:
- Scope 1 – direct GHG emissions occurring from sources owned or controlled by the reporting business. Examples would include heating, manufacture, transportation.
- Scope 2 – indirect GHG emissions occurring from the generation of purchased electricity consumed by the reporting business.
- Scope 3 – indirect GHG emissions occurring as a consequence of a business’s activities that are not directly owned or controlled by that business but occur within the company’s value chain. Examples would include employee travel costs, waste disposal, purchased materials and services.
ISO (International Organisation for Standardisation) 14064 is part of the ISO 14000 series of International Standards for environmental management. The standard is published in three parts to support organisations in regulated and voluntary programmes, such as emissions trading schemes and public reporting using a globally recognised standard.
The Carbon Disclosure Project informs investors about the significant risks and opportunities from climate change. As a voluntary initiative, businesses select the level of information they wish to disclose.
The Global Reporting Initiative is the most widely used sustainability reporting framework. Comprising a number of standards to enable companies to be transparent and take responsibility for their impacts.
Key Initiatives for Businesses to Support
As well as businesses stepping up and beyond what they are legally required to do, the focus is on working together to share best practice, overcome challenges and make change at scale.
The stated overall ambition of the UK Government, especially as President of COP26, is for all businesses to join the Race to Zero, through setting net zero targets with credible short term action plans for reaching these. In addition to the Race to Zero, another initiative is the Business Ambition for 1.5°C which is part of the Science Based Targets Initiative.
The SME Climate Hub is a useful resource, specifically designed for small businesses, through which they can commit to cutting carbon emissions by half before 2030 and reach net-zero emissions before 2050. The Hub has also published a Roadmap for businesses including SMEs outlining steps that can be taken to improve environmental performance.
As well as encouraging investments in clean energy, RE100 is an initiative for companies aiming to have 100 per cent renewable energy in the future.
Goal 13 Impact Platform: showcasing an open repository of corporate climate actions and facilitate learning and collaboration in the run up to COP26, and beyond.
COP26 has a LinkedIn profile where content is regularly posted.
Together for Our Planet is a campaign focused on UK domestic engagement run by the UK Government Department for Business, Energy and Industrial Strategy (BEIS) and the Cabinet Office.
Race to Zero Campaign
The COP26 Presidency also called on all businesses to join a global campaign ‘Race to Zero’, the largest global alliance on net zero, to coordinate support for a zero-carbon recovery.
Whilst individual businesses cannot sign up for the campaign directly, they are invited to join an initiative which is an official partner to Race to Zero. The objective is to build momentum around the shift to a decarbonised economy, with all members committed to the same overarching goal of achieving net zero emissions by 2050 at the very latest.
Small UK businesses can sign up to the Race to Zero by visiting the Business Climate Hub; an official UK Government site offering practical steps on cutting emissions and inspiring success stories from other businesses. Other small businesses from outside of the UK can also make commitments by visiting the SME Climate Hub.
Larger UK and non-UK businesses can join the Race to Zero campaign by visiting the UNFCCC website.