Companies with more greenhouse gas emissions than France and Spain combined reducing emissions by 35%, in line with the Paris Agreement
New report reveals that by meeting their science-based targets, 285 companies will eliminate 265 million metric tons of emissions from their operations, equivalent to closing 68 coal-fired power plants.
MADRID (December 4, 2019)—As world leaders meet in Madrid this week, with one year left until countries are expected to submit enhanced climate targets to keep the Paris Agreement on track, a significant portion of the private sector is already delivering on the 2015 global climate accord.
285 companies responsible for more than 752 million metric tons of CO2 equivalent emissions per year from their operations—more than the combined annual emissions of France and Spain—have set greenhouse gas emissions reduction targets in line with what science says is required to avert dangerous climate change and meet the goals of the Paris Agreement. 76 of these companies’ goals are in line with limiting warming to 1.5°C above pre-industrial levels.
A new report published today by the Science Based Targets initiative (SBTi) reveals that by meeting their targets, these 285 companies will reduce their emissions by 265 million metric tons of CO2 equivalent, approximately equivalent to shutting down 68 coal-fired power plants. This represents a 35% reduction in companies’ emissions compared to their base year emissions.
“These companies are at the vanguard in the fight against climate change. They are proof that acting on climate science goes hand-in-hand with a successful business and economy,” said Alexander Farsan, Global Lead for science-based targets at WWF, one of the SBTi partners. “Every company in every sector must step up and reduce their emissions in line with what science says is needed, or risk being left behind in a changing world.”
The report “Raising the Bar: Exploring the Science Based Target initiative’s progress in driving ambitious climate action,” is the first-ever assessment of the initiative’s impact since its launch in 2015.
Other key findings from the report include:
- The 285 companies that have set science-based targets will drive investment of up to USD$18 billion in climate change mitigation and spur up to 90 TWh of annual renewable electricity generation, enough to power 11 million U.S. households for a year.
- In addition to setting science-based targets for their operations (which includes on-site emissions and emissions from purchased energy), more than 90% of the 285 companies have also set ambitious emissions reduction targets for their value chains emissions, which make up 3.9 billion metric tons of CO2 equivalent emissions per year — roughly equivalent to 90% of the European Union’s annual emissions.
- Science-based targets are becoming standard business practice in some geographies and sectors. More than 20% of high-impact companies in the following sectors have set science-based targets: apparel, biotechnology, food and beverage, healthcare, hospitality, information technology, pharmaceuticals and telecommunications.
- First-movers from high-emitting industries like cement, steel, chemicals and automobiles are having their science-based targets approved. Among the trailblazers are thyssenkrupp AG, Royal DSM and HeidelbergCement.
- At least 20% of high-impact companies headquartered in several large developed markets, including Finland, France, Denmark and Japan, are setting science-based targets.
- Japan is the first country to provide explicit government support for companies to set science-based targets. As of October 31, 2019, there are 52 Japanese companies with approved targets, and the Japanese Ministry of Environment has set a goal of 100 Japanese companies with approved targets by 2020.
- With the notable exception of India, which counts nine companies with approved science-based targets, only a few companies in emerging markets have set science-based targets. Companies headquartered in non-OECD countries make up only 6% of companies with approved targets.
The private sector’s uptake of science-based targets sends a clear signal that the transition to a low-carbon economy is underway. Business action provides a foundation for governments to set more ambitious policies and regulations. However, companies rely on governments to create the right conditions, policies and incentives to drive the rapid transformation needed and help businesses to accelerate their climate action across all sectors and geographies.
The Science Based Targets initiative (SBTi) is a collaboration between CDP, the United Nations Global Compact, World Resources Institute (WRI) and World Wide Fund for Nature (WWF). The initiative uses the latest available climate science to define best practice in science-based target setting, offers resources and guidance to reduce barriers to adoption, and independently assesses companies’ targets against its validation criteria.
More than 680 companies in total have made a commitment to set science-based targets since the SBTi started in 2015. Once they have made a commitment, companies have 24 months to develop and submit their targets to the initiative for validation.
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About the Science Based Targets initiative
The Science Based Targets initiative mobilizes companies to set science-based targets and boost their competitive advantage in the transition to the low-carbon economy. It is a collaboration between CDP, the United Nations Global Compact, World Resources Institute (WRI) and the World Wide Fund for Nature (WWF) and one of the We Mean Business Coalition commitments. The initiative defines and promotes best practice in science-based target setting, offers resources and guidance to reduce barriers to adoption, and independently assesses and approves companies’ targets.
To learn more, follow @sciencetargets on social media and visit our website at www.sciencebasedtargets.org.
COMPANY QUOTES TAKEN FROM REPORT AND AVAILABLE FOR MEDIA USE:
Why companies are setting SBTs
“The momentum for our target came from the top management, with strong support from the sustainability department. We could see clearly what was happening to industries that were failing to adapt. As big players in an important industrial sector we knew we had to act. There are a number of imperatives for – and potential benefits of – action, including enhanced reputation and lower costs.” – Peter Lukas, Sustainability Manager, HeidelbergCement
“Climate strategy is core to our company strategy – increasingly so. Emissions are a key factor in operational decisions. There are a number of reasons for this. Regulation creates pressure; markets are changing; we need to take into account long terms risks and opportunities; it’s important from a competitiveness perspective. And then there is personal conviction: we have to do this, it’s the right thing to do, and we have to start now if we want to be ahead of the others.” – Daniel Schleifer, Senior Sustainability Manager, thyssenkrupp
“Our science-based targets will challenge us even more to work in new ways, and will drive innovation and renewal in our business. The transition to a low-carbon economy is not only a challenge, but something which will bring new opportunities. The low-carbon economy is boosting investment and innovation. It’s inclusive, and will create meaningful work.” – Karol Gobczyński, Climate and Energy Manager, Ingka Group
“For HPE having a product use goal is important because it aligns with our business strategy and offers the opportunity to differentiate ourselves in the market. We want to be known for cutting edge technology that drives transformational efficiency. This is what we offer our clients. By increasing the energy efficiency of our products we are providing business value to our customers.” – Shannon Siart, Manager of Climate Strategy & Sustainability Initiatives, HPE
“Consumers today expect brands to stand for something. Consumers want us to show we are a sustainable business. It’s about what we do, say and how we behave but also what we make and how we make it. We need to be part of the conversation, and use our global reach and brand equity to galvanise our partners, other industries, and other sectors. Initiatives like Science Based Targets and the G7 Fashion Pact, which we recently joined, are important for maintaining trust.” – Virginia Rustique-Petteni, Senior Director of Engagement for Global Sustainability, Nike Inc.
How companies are implementing SBTs
“A science-based target that includes scope 3 emissions signals little more than intent until a company’s suppliers are aligned and committed to the reduction required. We have been setting carbon reduction targets with our supply partners for nearly a decade and are using our science-based target to guide our current target setting process with both finished goods and materials suppliers. We have also initiated a discussion with several of our most strategic suppliers on having them set their own science-based targets.” – Scott Vitters, Senior Director of Sustainable Manufacturing & Sourcing, Nike
“We have launched the world’s first comprehensive supply chain management program. The program includes three key components: an aggressive new goal to drive accountability within our own supply chain; a plan to build the capability of our suppliers to set science-based targets in their own operations; and a commitment to lead the business community by setting a standard for supplier GHG engagement and abatement. It’s a ripple effect that will drive action through our suppliers, customers and the world.” – Shannon Siart, Manager of Climate Strategy & Sustainability Initiatives, HPE
The need for collective action
“Setting science-based targets highlighted the scale of the decarbonisation that has to happen across the whole economy. Our scope 3 target covers raw material extraction and basic processing for the key commodities that our industry and others rely upon. If we are to meet our science-based target, these sectors must contribute; we can’t do it alone.” – Jeremy Lardeau, Senior Director of Global Sustainability Data & Analytics, Nike
“This is an overarching societal task which won’t work if one company alone tries to do it. The whole industry needs to cooperate and fundamentally change the way it works. We need a lot of political support, regulatory support, and commitment from companies.” – Peter Lukas, Sustainability Manager, HeidelbergCement
“There are some really big challenges to get to where we need to be. These changes don’t just have to take place within single companies, but across whole industries, the whole economy, including energy provision and infrastructure. It’s a wholescale transformation that is needed but I am confident and positive that it is possible.” – Daniel Schleifer, Senior Sustainability Manager, thyssenkrupp
“We have to do our bit. But in order to be carbon neutral in our value chain we are dependent on clean electricity. Politicians have to act. Ultimately, we are dependent upon decarbonising the grid. We can play our part by creating demand for renewables, but governments need to commit to decarbonisation.” – Henrik Sundström, Vice President, Group Sustainability Affairs, Electrolux
“None of us can deliver on the Paris agreement without significant changes to government policy. Even the more progressive companies like ours know we are not going to get where we need to unless the key policies are broadly in place, starting with a meaningful price on carbon. The whole sector and the actors in our supply chain need to be lifted up, and that will only happen with legislation.” – Jeff Turner, Vice President Sustainability, Royal DSM