Giving Compass' Take:
- Corporate net-zero targets can play a role in addressing the climate crisis and accelerate climate action but require credible approaches.
- How can donors partner with companies to improve net-zero targets and ensure a practical approach to curbing emissions? How can corporations also address climate justice with these targets?
- Learn more ways for businesses to reach net-zero.
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The concept of reaching net zero emissions has grown from an emerging idea to a mainstream mechanism for countries, cities and corporations to drive emissions reductions and limit the effects of climate change.
Just two years ago, only a handful of companies committed to achieving net zero emissions by mid-century or sooner. Since then, a wave of companies across sectors have adopted net zero targets and are designing strategies to achieve these goals.
Net zero commitments cover one-fifth of the world’s largest corporations and 68 percent of global GDP, compared to 16 percent in 2019.
It is critical that businesses set net-zero targets and for everyone to be confident about how they will be achieved. The lack of a standardized approach has meant companies have been devising their net-zero strategies with little transparency on the scope and boundary of the targets and the plans for reaching them.
This has led to skepticism about these corporate targets and concerns that they are a new form of greenwashing. Critics have been especially concerned about corporate net zero targets depending heavily on carbon offsets, rather than a business taking rapid action to decarbonize its own value chain where accountability and influence are highest. Carbon offset projects often generate a greenhouse gas (GHG) credit, a unit of carbon dioxide that is reduced, avoided or sequestered. And companies typically use investments in offsets to enable claims of climate neutral, carbon neutral or climate positive — such as building wind farms, planting trees and energy efficiency projects.
Corporate net-zero targets can be a powerful tool for curbing emissions and addressing the climate crisis — but only if proper safeguards are implemented. Here are three approaches companies should take to demonstrate that their net-zero targets are credible and will accelerate climate action:
- Set near-term science-based targets
- Set long term science-based net-zero targets
- Invest in cutting emissions beyond the value chain
Read the full article about corporate net-zero targets by Cynthia Cummis at GreenBiz.