Clarity, Consistency, Competition and Carbon!
by Neil Ross Russell, Founder at Net Zero Now
Chris Skidmore’s Net Zero Review, published last week, clearly and emphatically makes the case that transition to a Net Zero economy is not only necessary, but an unmissable growth opportunity for the UK.
We agree - positive climate action on an economy-wide basis is not only our only hope of meeting our Net Zero targets, but will also drive demand for decarbonisation solutions, creating the growth opportunities for UK businesses outlined in the Review.
But…right now, in place of “positive climate action on an economy-wide basis”, we’ve got a lack of clarity and consistency as to how businesses should measure and reduce their emissions and, ineffectual threats about climate disaster aside, nothing on why they should do it.
To realise this opportunity, we need to create an environment where all businesses have a clear commercial incentive to reduce their emissions. Regulation can and should play a role in creating this environment but as Mr Skidmore points out, “the benefits of decarbonisation are larger if it is done sooner” and businesses don’t tend to embrace regulation quickly or without a fight.
If we want to drive action quickly, we need harness the power of competition. The demand for low / zero emissions products and services already exists amongst consumers and Government, we just need to create the conditions for suppliers at every stage of the value chain to compete to meet that demand.
The most critical of those conditions is access to consistent, reliable data. Businesses need to be confident they are measuring and reporting the same sources of emissions as their competitors and customers need to trust they are comparing like for like. Global guidelines like The GHG Protocol, The SBTi and The Oxford University Principles provide the guiding principles every business needs to follow, but they can’t be expected to recognise the specific nuances of every scenario, in every sector, in every country; leaving critical elements of the process open to interpretation.
These grey areas prevent individual businesses from taking positive climate action, both because navigating them requires specialist (i.e. expensive) knowledge, but also because they may still be accused of greenwashing if their consultant’s interpretation doesn’t tally with the expectations of the market. The uncertainty also prevents the efficient exchange of carbon emissions data and therefore the ability of businesses to credibly report their carbon footprint and compete based on the level of their emissions.
At Net Zero Now, we work on a sector-by sector basis, collaborating with industry bodies and corporate partners to create a suite of sector-specific “Net Zero Protocols” including in Accounting (with Sage Group, ICAEW, ACCA, AAT & AIA), Law (The Law Society), Hospitality (Coca Cola, Pernod Ricard & The Sustainable Restaurant Association), Tech (TechNation, Tech UK, BIMA), Hair & Beauty (L’Oréal, The British Beauty Council), Financial Advisers (CISI, Liontrust Asset Management, Fintel) and many more. Each Protocol not only provides a clear, industry-standard pathway to Net Zero, but also allows them to communicate their achievements, either by sharing consistent and accurate date or through a credible Certification Mark both measured against a common standard.
Each of our Protocols is publicly available, ensuring complete transparency – you can see them here – so if you’re looking to transition to Net Zero, take a look and if we don’t have one for your sector, reach out to us, or talk to your industry body about developing one.”
Carbon accounting is a new discipline and the lack of standards is no different to most emerging markets. Capital markets work because they are based on a consistent step of financial accounting principles, but it wasn’t always like that. Businesses had been recording their financial performance for a couple of hundred years, but it took the financial crash of 1929 for people realise need for consistency of data…wait for the environmental equivalent is not an option.
For more information go to www.netzeronow.org or to speak to Founder Neil Ross Russell contact firstname.lastname@example.org.