I’ve been having a lot of conversations lately about goals for the year 2030. Companies are asking where their business should be in 10 years, and whether their environmental goals are solid enough to get them there. Here’s a glimpse into how these conversations typically progress — from vision, to concepts, to the nuts and bolts of science-based goals.
We want to be thriving in 2030. For that, we know we need to make sustainability the core of our business, not just an add-on. How do we start that process?
To thrive in 2030, you need to change the way you think about your environmental goals. At Quantis, we’re working toward a 2030 world in which companies don’t have sustainability goals but goals to be sustainable. We call it the Absolute Sustainability Mindset. Instead of setting relative sustainability targets for incremental improvements, you look to science to understand the level of ambition you need to be sustainable within the limits of the planet — and set the target there. It’s a shift from traditional business goal-setting. You’re familiar with “SMART” goals. With absolute sustainability, you move to what we like to call “SMARTER” goals.
At Quantis, we’re working toward a 2030 world in which companies don’t have sustainability goals but goals to be sustainable.
What will this science-based journey look like? Can you give me a bird’s eye view on this?
The journey starts with an ambitious climate strategy, then moves on to other key environmental indicators such as water, land, and biodiversity. Be it for greenhouse gas (GHG) emissions or water, the process of setting science-based goals is more or less the same. First you assess your hotspots and build the business case for science-based action. Then, once you have buy-in from your leadership, you set your targets, build a roadmap to achieve those targets, get your operations teams on board, and, finally, implement your action plan, monitoring and adjusting as you go.
I’m convinced we need to be bold on climate, but my leadership team may not be. What can I do to bring them on board?
You have to start with why. The business case for bold climate action has never been stronger. To build your case, you’ll need metrics. Assess your company’s climate “hotspots” by completing a corporate value chain footprint and market analysis. Your footprint reveals your GHG impacts. Market analysis highlights risks and opportunities related to climate. The two combined will bring your hotspots into focus.
For an accurate carbon footprint, you’ll have to look beyond your direct operations to include emissions from across the value chain (what’s called “Scope 3”). If moving beyond your “control zone” seems intimidating, check out the Scope 3 Evaluator. It’s a free, user-friendly online tool we created with WRI to help you get an initial snapshot estimate of your full carbon footprint.
When you look to the market and your industry, you’ll see how you compare to your peers and recognize what your stakeholders expect of you on climate action. You’ll identify physical, financial, reputational, and regulatory risks and opportunities. Metrics from your full carbon footprint and insights from your market assessment will bring the clarity you need for a solid case to get leadership and other key stakeholders on board.
I recently hosted a webinar with WRI on this topic.
Okay. Once I have buy-in, what is the actual process of setting science-based targets through SBTi?
More than 500 companies have committed to develop science-based targets through the Science Based Targets initiative (SBTi), and nearly 200 of those have already had their targets validated. We’ve worked with a number of them. The process is straightforward. Take Danone’s journey, for instance. First, in 2015, Danone’s CEO made a commitment to set science-based targets. Next, the team developed reduction targets on Scopes 1, 2, and 3, using Danone’s value chain corporate footprint as a baseline. Then, they submitted those targets to the SBTi for validation. Now the company is moving from commitment to action across the value chain, tackling high-impact areas such as raw materials and packaging through regenerative agriculture and ecodesign.
We’ve heard about the 1.5°C SBTi developments. How does this update impact our targets?
Following last year’s IPCC report, the SBTi updated its criteria to reflect the latest developments in climate science, shifting the level of target ambition from 2°C to well below 2°C or 1.5°C. For companies that have already set science-based targets in line with 2ºC, those targets are still valid but companies will need to have their targets reviewed (and possibly revalidated) every five years.
By the end of 2024, updated targets will need to be aiming at well below 2°C. Beginning in October 2019, new SBTs will need to be aligned with well below 2ºC or 1.5ºC. They’ve just released new criteria and resources that reflect these updates. I made a short write-up on what the 1.5°C update means for your company. To help you navigate the whole SBT process, we’ve put together some resources on our website.
So the SBTi gives me a reduction target and date. Then I need to figure out how to reach that goal. How do I tackle that process?
With your targets set, you can build out your roadmap to reach them. Your highest impact areas are also your greatest reduction potential. Once you’ve modeled reduction pathways for each category, you’ll probably still have a gap to reaching your science-based target. At Quantis, we call this “The Innovation Gap.” If incremental changes don’t get you to your target fast enough, you’ll know it’s time to shift gears. The climate roadmap shows when to move into the fast lane with disruptive innovations or even business model changes.
Collaboration and clear governance will be key in this phase. You’ll need buy-in from both your C-Suite and operations teams to make sure the plan gets implemented. For a deep dive into setting science-based targets, check out my conversation with IKEA + WRI + WWF in this webinar.
The SBTi is for carbon targets. What can I do about other environmental issues such as water, land use, and biodiversity?
Science-based targets on other environmental indicators are already in the works. The Science-Based Targets Network formed to gather key stakeholders to help translate the evolving science of planetary boundaries into corporate-level goals on water, land, biodiversity and oceans by 2021.
Companies have started getting ready for these new SBTs. At Quantis, we’ve designed a set of services to build capacity in organizations committed to work towards corporate targets aligned with planetary boundaries. It’s called The Absolute Sustainability Commitment, or TASC. We tackle TASC and SBTs beyond carbon in the last webinar of our goal-setting journey.
When our partners ask us to guide them on the goal-setting journey, we set out with Absolute Sustainability as our true north and science as our compass. We may not fully know how to get there, but we’ll tackle challenges head on and co-create solutions along the way.