Becoming a green company isn’t just good for the environment, but also for your brand image. Many companies, however, may find transitioning over to net zero a daunting task. Most are under the assumption that it will be impossible to maintain profit margins while undergoing such a process. Some companies resort to short-term solutions rather than attacking the problem as a whole. However, this tends not to be enough. Instead, businesses would be better off focusing on the long-term.
Instead of easy cuts, switching to renewable-sourced electricity would be a far better solution to help reduce carbon dioxide emissions. This serves as a much more ambitious and far-reaching approach to meeting reduction targets.
For businesses to reach net zero while remaining profitable, fixing the root causes of emissions will be a required focus. Even something as extreme as a full business remodelling may be necessary. For this, looking into IT consultancy services can help. It may sound surprising, but getting expert IT consultancy can help you reduce your business’s greenhouse emissions. Optimising IT will provide a plan to optimise your current practice and future-proof your IT infrastructure.
What Are Net Zero Emissions?
Thankfully, companies can make the net zero transition while remaining profitable, so long as they are willing to take action. Those who disregard these opportunities may face more hardships down the road. This is especially true with the ever-increasing requirements for reducing carbon emissions placed upon them by customers, policymakers, and investors.
Reaching net zero emissions would mean removing an equal amount of carbon dioxide (CO2) from the atmosphere to that which is, or has been, released into it. In other words, creating a balance between global greenhouse gas (GHG) emissions produced from human activity and emissions reductions.
Difference Between Net Zero and Carbon Neutral
What’s the difference between net zero and carbon neutral? These two terms have become interchangeable in some circles when referring to the reduction of carbon emissions. Both are about making strides to reach the same end result: removing harmful gas emissions from the atmosphere. The difference lies within the scale and type of emissions.
The term net zero refers to the emission of all greenhouse gases (GHG) and their removal from the atmosphere equaling those being emitted by human activity. Carbon neutrality targets carbon specifically and its removal should be equal to the carbon emitted.
The principle between the two remains the same. It just happens that net zero expands upon it, as something more all-encompassing. Achieving it will require action on a global scale and collaboration between world governments.
First Movers Coalition
First movers are services or products that gain a competitive advantage by reaching the market first. 2021 saw the creation of the First Movers Coalition of which more than 50 companies have already joined. The primary goal of the FMC remains the decarbonization of heavy industry and long-distance transport sectors responsible for 30% of global GHG emissions.
The UK has already joined as government partners with the US, Norway, Japan, Italy, Singapore, Sweden, and India to create early markets for clean technologies. The FMC is collaborating with leading organisations and companies which supply clean energy technologies. This creates an incredible opportunity for those companies willing to invest right now.
Strategies and Tips To Achieve Net Zero
It’s time that companies take immediate action to address the impending climate crisis. According to the Climate Change Committee, a timeline of 2050 has already been set to achieve net zero emissions within the UK. So what can be done to achieve this goal?
The global threat requires solutions and a commitment to these solutions in an attempt to mitigate emissions and adapt to climate change. Companies can begin with the creation of low-carbon technologies, commit to the purchase of zero-emissions goods and services, and ensure said goods and services remain cost-competitive.
We’ve outlined a few strategies to help your company get started on reducing its carbon footprint and help create a more sustainable future.
Identify and Assess Priority Areas
Firstly, you can figure out where your company is emitting the most GHG. Identifying priority areas where emissions can be reduced is a great start. Assess any risks involved with the reduction like whether the transition to net-zero creates additional complications. These are the things you’ll want to tackle to ensure a commitment to seeing your goals through.
Set your wealth and asset managers to the task of assessing climate risks and mapping out a strategy to curb them. Make a pledge by specifying how to accomplish the tasks. This can be a short or long-term pledge. Having a strong strategy set will make the commitment to reaching net-zero emissions company-wide a reality.
Establish Baselines and Commitments
Create a snapshot of your company’s GHG emissions. This can be from any moment in time, just to set a baseline. This will make it a lot easier to view and analyse your company’s emissions over time. The company can then plan ahead using the snapshot as a defining reference point against business decisions and projects to decarbonize in the future.
Next, we suggest organising and comparing emissions reduction opportunities found within your value chain. This helps to identify the most cost-effective opportunities for your company in terms of adaptation. While at the same time it can provide the opportunity for the comparison and contrast of marginal abatement costs of mitigation options across multiple business compartments. This makes it possible to generate accessible and user-friendly Marginal Abatement Cost Curves (MAC Curves) efficiently and effectively.
Internal Carbon Pricing
Place a monetary value on the carbon emissions produced by your company. In other words, give your company an internal carbon price and calculate it based on the impact your GHG emissions have on the environment.
Doing this makes it easier to apply climate risks to your business’s bottom line. It can also help identify low-carbon opportunities as well as organise the budget for net-zero adaptation.
Successfully budgeting for a net-zero transition is paramount. Achieving this lofty worldwide goal is likely to be capital-intensive. Establishing an internal carbon price will help to mitigate risk and meet budgeting guidelines.
Research Future Innovation Opportunities Like Low-carbon Emissions Technologies
Emitting carbon has become far more costly in many countries across the globe as a result of carbon pricing. However, the creation of low-carbon technologies has aided other organisations to monitor, predict, and achieve their expected emissions reduction goals. The demand for low-carbon equipment, building works, infrastructure, and transport solutions is likely to rise considerably moving forward.
There have been many studies that have broadly identified the future innovative technologies to be developed, demonstrated, and augmented to deliver a worldwide net-zero outcome. Many of these technologies already exist and are being produced and deployed at scale. Unfortunately, the bigger portion of these required technologies is still in the research, development, or demonstration phases.
Your company can play an active role in establishing the vision and creation of the low-carbon future we hope to achieve. It can be done in part by encouraging stakeholders to take action on delivering that which is required for such an ecosystem to exist.
The UK already has the Coalition for Negative Emissions working on delivering a solution. They have deployed many carbon removal experts in order to scale up the market in removing GHG from the atmosphere. These solutions include both natural and engineered CO2 removal in the forms of reforestation, and carbon capture and storage.
Understand GHG Regulations
Policies for GHG have not yet been set in place as they are likely to vary by country based on many factors. However, companies that are serious about climate change and the part it will play on their bottom line will want to understand the implications of environmental regulations now and in the future. Your company will want to invest in understanding the fundamentals of climate change policy and the consequences it could face.
Company leaders can perform quantitative assessments of their company’s operating model based on future possibilities concerning the internal carbon price, customers, suppliers, and even competitors. Though exacting the effective price is not likely to be possible, getting a good grasp on the expectations and estimate range can help test future profitability and allow for adjustments on investment opportunities.
This type of exercise can help determine obstacles, even unexpected ones, and what to do should you encounter them. It can also present unforeseen possibilities and opportunities for your company and its growth. Both scenarios further emphasise the need to carefully understand the potential business implications of your company’s net-zero transition.
Future-proof IT Infrastructure
Information technology (IT) plays a vital role in developing long-term solutions for a sustainable future. Enabling innovations such as the development of clean energy systems can help tech companies work to minimise their carbon footprint.
Tech companies cannot treat reaching net-zero emissions as a side project. Putting a strategy in place that aligns with your company’s core values is the best way to do business. Recognizing the urgency of the catastrophic impact that climate change will have on the environment should be a value any company can get behind.
Future-proofing a company’s IT infrastructure for the coming green transition is not much different than any other type of organisation. You’ll want to define measurable goals, set a realistic timeline, align on key tactics, implement a metrics tracking system, and optimise your progress as time goes on.
There are many IT consultancy services and specialists to help develop a plan of action for your company. Optimising IT consulting services covers a range of IT business needs. You can find aid in business intelligence consulting, data privacy consulting, information security management, and much more. If your company requires IT consultancy services in the UK, Optimising IT can assist.
The Main Areas of Action When Tackling Net-Zero Emissions
At the UN Climate Change Conference (COP26), the following three main areas of action were outlined in an open letter to world leaders:
Stop Using Fossil Fuels
Switching from fossil fuels to clean energy and clean energy products will need to be accelerated. Fossil fuels will need to have financial support and subsidies stripped away in favour of clean energy and low-carbon technologies. Policymakers will also need to cut tariffs on climate-friendly practices and goods while taking adequate measures to ensure a just transition.
Investments, both public and private, are essential to creating resilient supply chains and climate-resilient infrastructure, secure water supplies, and sustainable food production.
Laws and regulations regarding climate change would need to be harmonised to help accelerate technologies and best practices that would encourage the public adoption of low-carbon products. Furthermore, policymakers should support and incentivize those leading the charge in the fight against climate change to help push innovative and existing proven solutions over the long term.
This outline was signed by more than 90 CEOs of multinational companies. The difficulty lies within the mobilisation of capital for large-scale infrastructure projects. However, all that has been outlined and disclosed is both urgent and necessary to reach the proposed goal of net zero by 2050.
Breaking It All Down
Companies looking to achieve partial net zero by 2030 (full by 2050) have a lot of work to do. The sooner you begin tackling the root causes of your company’s GHG emissions, the faster you can reduce them across the entire value chain. IT consultancy can help.
Our advice? Avoid focusing on easy cuts and short-term solutions and try to see the bigger picture. A company will need to be far more ambitious and take a wider approach to reach its carbon reduction targets.
Try not to allow the possibility of lowered profits to sway you from achieving a net zero goal. It is possible to remain profitable, so long as you’ve discovered, assessed, and addressed the root causes of emissions within your own company. For IT consultancy and strategies regarding IT infrastructure, reach out to experts in the field.
Transitioning to net zero does not have to be a daunting task. Understanding what you can do to achieve it while mitigating losses and overcoming obstacles will see you through to the end goal.