The challenge of Net-Zero – Pathways and Principles

IEMA Policy and Engagement Lead Nick Blyth discusses how sustainability professionals have the critical and central challenge, in addressing Net-Zero complexity and to build relevant and tailored transition pathways in his blog.

Sustainability professionals are at the centre of a Climate Change revolution, advising Boards and clients on the Climate Emergency, setting targets, building strategies and approaches. There is a range of developing guidance and information to navigate and some confusion around language and terminology. Emerging guidance, tools and frameworks will help, but complexity runs deep. Sustainability professionals have a key role, unpicking this complexity and developing credible transition pathways. In IEMA’s new Net-Zero white paper, we start to address these challenges, updating our own guidance and frameworks and outlining some key principles.

The starting point of the journey to Net-Zero is knowledge and understanding of the organisation and its most significant carbon emissions. Wider trends and drivers around the business model are also important, such as changing markets and future profitability. Keeping advice up to date and relevant is therefore fundamental both technically, concerning climate change, but also strategically for the organisational context.

Commitments to Net-Zero itself, alongside claims such as Carbon Neutrality and Carbon Positive sound transformative – but to be so, all need embedding as significant organisational commitments. To be credible such commitments require underpinning and should include all annual carbon emissions that can be influenced. The need to address legacy (past) emissions, alongside the future transition to Net Zero, has emerged as a further consideration (for example in young business sectors like Tech, where nearly all ‘lifetime emissions’ are in the atmosphere). With developments such as TCFD[1] and the recognition of the Climate Emergency[2], Corporate Responsibility is itself evolving with the potential to place annual carbon disclosure at the heart of a public facing strategic transition narrative.

IEMA first provided guidance on carbon transitions in 2009, publishing a Practitioner Guide on Climate Change Mitigation and including the GHG Management Hierarchy (updated in 2014 and again this year to address Net-Zero). The hierarchy has informed wider guidance and standards (e.g. via ISO and UNFCCC) and over 50% of IEMA survey respondents (2019) had used the hierarchy within their work. Part of the original rationale was to focus on significant and so called ‘at source’ carbon emissions and avoid the risk of jumping straight to an offset solution. IEMA’s white paper ‘Pathways to Net-Zero’ has updated the hierarchy and has added new diagrams and principles in support of its use for Net-Zero transitions. The central focus on optimum carbon reductions remains, but it is recognised that the climate emergency now requires an escalation of action across all fronts. Although context is critical and specific approach will vary, several core practice considerations and principles are identified.

So, should an organisation look to become carbon neutral, Net-Zero, or potentially both? Genuine science-based reduction to Net-Zero is a clear priority and must be a cornerstone in all approaches. IEMA and partner organisations follow this approach within the collaboration - 'Pledge To Net Zero'

Many who recognise the urgency of the Climate Emergency, now recognise the need for simultaneous action on both a compensation and on a transition front. This involves setting science-based reduction targets and, at the same time, looking to balance or to compensate current emissions, for example through supporting and using the developing carbon market. Such an approach must be transparent and distinguish the use of the terms;

• Carbon neutrality is in this instance used to describe a current status, in effect a point in time ‘economic’ neutrality. It is nearly always supported by the purchase of carbon credits (offsetting) and can be extended beyond neutrality (concepts such as Climate Positive).
• Net-Zero is here used as a separate science-based transition target, pursued through genuine reductions by the organisation itself and in line with recognised climate science scenarios (involving a balancing of residual emissions in future via suitable measures that can include carbon credits / offsets).

IEMA are using such a complementary approach, affiliating to the UNFCCC’s Climate Neutral Now programme, as well as Pledge to Net-Zero. Some will instead use the transition target of Net-Zero and meanwhile invest into an internal transition fund (and at a later date commence compensation payments such as offsetting).

The choice of approach and pathway will always be influenced by the organisational context. Although there may be no fixed answer, there are some central principles and considerations outlined in IEMA;s white paper.

Wider developments in standards and guidance will continue to help. The recently published ‘Oxford Principles’ for example provide one vision on how carbon offsetting can contribute towards transition approaches. Other important initiatives include SBTi developing a Corporate Standard for Net-Zero, ISO developing a new standard on Carbon Neutrality and Mark Carney’s Taskforce on Scaling Voluntary Carbon Markets.

Sustainability professionals have the critical and central challenge, in addressing Net-Zero complexity and to build relevant and tailored transition pathways. IEMA’s Climate Change and Energy network is a forum for sharing action on Net-Zero and IEMA’s new white paper is rooted in feedback and practice learnings supplied by these professionals. In 2021, I look forward to further webinars, papers and blogs on specific Net-Zero challenges. Meanwhile, the updated Hierarchy and white paper is a basis and IEMA contribution to the developing challenge of Net-Zero and the Climate Emergency.

Download the IEMA Pathways to Net Zero paper here.

[1] In 2019 IEMA published user guidance on TCFD with the Institute and Faculty of Actuaries and this along with wider guidance is available on the TCFD hub (extensive knowledge hub hosted by CDP).

[2] In 2019 IEMA’s Board declared a Climate and Environmental Emergency - https://www.iema.net/climate-emergency