The world is inching closer to 2030, a year in which global emissions are to be reduced by 50%, limiting global warming by 1.5°C. However, as time continues to run out, global efforts have been falling behind, hindering us from achieving our goals.
These next few years will be crucial if we want to stay on track with worldwide efforts to reduce the impact of climate change. Additional pressure from consumers, investors, governments, and policy makers have stirred companies to develop and adopt new business practices aligned with sustainability and climate action, ranging from reducing emissions to reevaluating supply chains.
Ensuring that we limit rising temperatures below 1.5°C requires an effective climate strategy that acknowledges the relationships between business, the environment, society, and the governing structures built around to sustain all parties as we transition to a low carbon economy. A strong climate strategy can future-proof businesses by mitigating the risks of climate change, open themselves up to new opportunities they can potentially capitalize on, and strengthen their brand reputation and positioning in a market that is increasingly becoming eco-conscious over time. Through developing a climate strategy, a company can prepare themselves for the impending impact of climate change and secure their business, as consumer and investor decision making evolve along with sustainability policies and regulations.
The next few years are crucial. Here is how you can stay ahead.
An effective climate strategy requires planning and a clear understanding of your business and how it impacts the environment. Here are ways for you to get a good head start in this transition to a low carbon economy.
Having senior leadership committed to sustainability, especially in climate change risk mitigation, can support your efforts in building an ambitious climate strategy. Sustainability leaders can back efforts to integrate climate strategy across functions and ensure a culture of sustainability is fostered and deeply embedded in the organization. Through sustainability leadership, you can then build teams and gather climate strategists and experts who can provide the business with the knowledge required to take your company from one point to the other.
A climate strategy is only effective when it addresses the impact, risks, and opportunities your organization has towards the environment. In this phase, sustainability teams should assess their current sustainability performance. This means calculating total greenhouse gas emissions and breaking these down to Scope 1, 2, 3 emissions to get a better overall picture of which areas contribute the most to global warming. The team should also review internal policies in place and how these can be adjusted to accommodate plans to embed sustainability into day-to-day operations.
Not only should the team review the impact the business has towards the environment, sustainability teams should also assess the risks and opportunities external environmental and societal factors may bring to the company. This, in addition with internal assessments, will then help develop a climate strategy that both mitigates risk and adapts to external threats in a time of uncertainty.
Clear goals and targets can help you make an effective strategy. These should be backed by scientific evidence and aligned with local and international targets and criteria. Having these goals time bound will also set the pace on how your climate strategy will look like through the years, considering worldwide goals for 2030 and beyond. Once you have a set of goals that consider current and future capacities and global standards, you can have a better outlook on how to plot your climate strategy.
Now that you have your targets, it is time to lay out your plans. Your climate strategy should have initiatives that can accomplish short and long term goals. This strategy can include plans to shift towards renewable energy or upgrade facilities and equipment with more energy efficient technologies. Using the data gathered on your current supply chain performance, your strategy can also address key areas, operations, and suppliers by engaging with these functions and encouraging them to reduce their carbon footprint. Your climate strategy could also consider redesigning products and services to make them more energy efficient and sustainable.
Once your climate strategy has been approved, it’s time to put it into action. Yet to do this, you will need to equip teams and stakeholders with knowledge and resources. As you implement your strategy, make sure to communicate your goals effectively to ensure sustainability is continuously embedded in day-to-day efforts. The journey to net-zero can be complex and changing. By enhancing climate literacy and awareness, you can continue to remain on track with your targets, motivating teams towards achieving sustainable development.
Communicating your sustainability efforts is necessary as this allows you to inform stakeholders and governing bodies about your commitments, contributions, and impact towards the environment. Make sure to update your stakeholders about your net-zero commitments and progress in your annual sustainability report. By reporting and engaging with your stakeholders on climate issues, you can gain more insight on how to move forward in your strategy and improve in your efforts.
Your climate strategy will require support from different functions, stakeholders, and technology. Here is some additional advice for you to use when implementing your climate strategy.
Your climate strategy can be a gradual and steady climb towards net-zero. It’s best to start out first with initiatives that you can pursue given the current capacities and limited resources you may have. However, as this fight against climate change is also a race against time, your climate strategy should also be scaled over time, with sustainability further being integrated into your organization. Starting with what you have now can help build confidence and climate literacy. Then you can start amplifying your efforts and stretching these even beyond the value chain.
Climate technology and literature can help ease efforts in implementing your strategy. ESG data management software can keep track of your emissions and other key factors material to your business and industry. In addition, carbon accounting technology can support you in visualizing your progress towards net-zero. Lastly, to ensure your climate strategy is aligned with international standards, resources from the Science-Based Targets Initiative and the Task Force for Climate-Related Financial Disclosures can guide you throughout the entire process, providing you with information supported by climate and industry experts.
When implementing your climate strategy, it is important to keep in mind that progress may accelerate or slow down, considering external factors affecting your progress and if worldwide efforts are making better progress or not. Your teams should be open and ready to adapt to new changes. Setting up measures for monitoring performance, and increasing awareness towards current sustainability news can help you adjust to potential changes and improve your performance.
We are heading towards sustainable futures. The modern day business is a sustainable business that seizes opportunities to mitigate and adapt to risks and threats induced by climate change. One way to evolve alongside this changing environment is to combat climate change through a climate strategy that ensures long-term sustainability and economic growth. By understanding the present and taking immediate action during these critical years, we can reshape the future of the planet and of the way we do business.
At Keslio, we are deeply passionate about sustainability, equipping us with the expertise and extensive network needed to guide clients through their sustainability journey effectively and efficiently. Our expertise is particularly valuable for companies looking to embed sustainability practices into their businesses and investors looking to integrate ESG and impact into investment portfolios. To learn more about how Keslio can assist your organization on its sustainability journey, please don't hesitate to get in touch with us.
