A new sense of readiness and willingness from companies is transforming how businesses approach responsible growth. Corporate sustainability is no longer viewed as a trend, but as a necessity. That’s why leading companies across the U.S. and the globe are recognizing that capturing value requires improving energy management, engaging suppliers and driving innovation. One of the most effective ways to do this is by setting targets that are in line with what climate science says in necessary to keep warming below 2 degrees, known as “science-based targets.”
Why set a science-based target? The potential rewards are many. Companies that set ambitious, measurable targets can:
- become leaders in innovation, paving the way in the development of new technologies and operational practices.
- stay ahead of future policies and regulations that may limit GHG emissions, thereby reducing regulatory uncertainty and risk, helping to strengthen investor confidence and credibility.
- improve profitability and competitiveness, affirming a company’s ability to adapt to changing circumstances while planning for sustainable, long-term growth.
In setting targets, companies can improve not just their own operations, but across value chains by encouraging suppliers to set targets of their own. Walmart was the first retailer to set a verified science-based emissions-reduction plan: reducing 1 gigaton of emissions in its supply chain by 2030 through “Project Gigaton” — equivalent to taking more than 211 million passenger vehicles off the road for a year. It’s also an opportunity for suppliers and organizations to join the cause and reduce GHGs of their own.
Here’s how they work. Targets based in science are founded upon three elements: a carbon budget, an emissions scenario and an approach.
- The global carbon budget is the amount of carbon the world can emit while staying on a path below a 2-degree rise in temperatures. A company gets allocated a share of this budget, and must act to operate within it.
- The emission scenario is aligned with the goals of the Paris Agreement, which aims to limit the temperature increase to 1.5 degrees Celsius above pre-industrial levels.
- The Science-Based Target approach is the avenue a company chooses to follow when developing a target. It can be a sector-based approach, an absolute-based approach or an economic approach.
It’s not an easy task setting these targets, but there are resources, including step-by-step guides and criteria, available that can help ease the process.
Environmental Defense Fund is partnering with World Wildlife Federation (WWF) to host a webinar on October 3, on setting science-based targets and how it can benefit your company. Join us as experts Tim Letts and Matthew Banks from WWF lead the conversation, giving their insights on the process.