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Companies tighten climate goals as scientific outlook darkens

Companies tighten climate goals as scientific outlook darkens
Business
The Paris climate agreement asks countries to hold the Earth’s temperature to “well below 2°C” and to strive for no more than 1.5°C of warming. It does not explain to the rest of the world what those numbers mean for them.

In the years since the 2015 agreement, a consortium of NGOs has worked to help companies figure out just what their contribution should be. The Science-Based Targets Initiative uses scientific research to translate hard-to-understand global benchmarks into industry- and company-specific targets. To date, more than 630 companies from 43 countries have signed on. The group is responsible for about 1 per cent of overall climate pollution. If they meet these goals, the companies will cut emissions by almost 30 per cent by 2030—or about half of Spain’s pollution, according to BloombergNEF.

Further reducing corporate emissions (and expanding the SBTI roster to include the financial sector) will be a hot topic during Climate Week in New York later this month.

The scientific consensus about what’s needed to control planetary warming has shifted over the past few years. The UN’s Intergovernmental Panel on Climate Change last fall issued an influential report suggesting that humanity must cut emissions even below the Paris targets. Namely, nations need to halve them by 2030 and zero them out by 2050.

“We see companies really responding to the IPCC report and seeing the need to increase their ambition,” said Cynthia Cummins, head of private-sector climate work at World Resources Institute, one of the research groups behind SBTI.

More than two dozen companies in July announced that they’d increased their ambition to match the 1.5°C challenge, including Enel, Iberdrola, Novozymes and Royal DSM. Others, including AstraZeneca, Hewlett Packard Enterprise, Levi Strauss & Co. and Unilever, already had 1.5°C commitments.

Companies that “had already set targets, to some extent, were some of the easier ones to convince,” said Bruno Sarda, president of CDP North America, one of the research groups behind the SBTI.

Setting science-based targets requires lots of data, time, judgment and internal political capital on the part of corporate sustainability officers, who often lead initiatives. Of the 634 companies who have committed to such goals, about 235 now have SBTI-approved plans. The SBTI receives funding from member-company fees, along with the Ikea Foundation, UPS Foundation and the We Mean Business Coalition.

“For many organizations that are on the fence for setting a target, that’s the place where they get hung up,” Sarda said.

The SBTI is not perfect, according to Katrina White and Kyle Harrison of BloombergNEF, who on Tuesday published a research note on the evolution of corporate climate goals. “The overall methodology remains convoluted,” they wrote. However, the initiative is more credible than arbitrary corporate emissions-cutting goals.
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