Dive Brief:
- Ahead of the United Nations Climate Action Summit in New York in Sept. 23, 28 companies representing $1.3 trillion in market capitalization have pledged to make stricter their carbon reduction targets, according to a press release. Unilever, Levi Strauss, SAP, Hewlett Packard Enterprise, AstraZeneca and Vodafone among others have committed to lowering their carbon emissions goals in line with keeping global temperature rise within 1.5 degrees Celsius (from pre-industrial levels).
- These companies previously committed to carbon reductions in line with a 2-degree Celsius temperature increase through the Science-Based Target initiative (SBTi). 600 companies have committed to SBTi (at the 2-degree standard) including Target, Walmart, CVS Health, PepsiCo, Keurig Dr Pepper and Nestlé. BT, Levi Strauss & Co., Hewlett Packard Enterprise and SAP have already adjusted their emissions targets to meet the new standard.
- The changes in carbon reduction targets are predicated by the results of a 2018 report from the Intergovernmental Panel on Climate Change (IPCC) that compelled industry and government to move from a 2-degree carbon reduction framework to a 1.5-degree goal.
Dive Insight:
The global temperature is currently roughly one degree above preindustrial levels, according to the IPCC Report. The effects of a continued rise are well-trod — more periods of extreme heat, more precipitation in some regions and more drought in others, wetter, more violent storms — all of which can have a real effect on supply chains.
"The science is clear: To limit the catastrophic impacts of climate change, we must ensure warming does not exceed 1.5°C. The ambition is high, but it’s achievable — and science-based targets give companies a roadmap for getting there,” said Paul Simpson, SBTi Board Member and CEO of CDP.
The potential impact is clear, but the path to doing something about it is less so.;
The IPCC report makes several recommendations for policymakers, but in many cases, including in the U.S., corporate action on climate change mitigation already exceeds government interest. Carbon removal efforts, like large-scale reforestation, for example, have a part to play according to the report, but reducing carbon production before 2030 is equally essential.
SBTi released new target validation tools in April to help companies adjust to a 1.5-degree rise target and is lowering its standard of approval for new targets to "well-below 2C," a SBTi spokesperson told Supply Chain Dive. Existing targets will stand until they require revalidation every five years.
Setting SBTi targets involves creating detailed action plans to reduce emissions over time. Upping the standard for those reductions likely means speeding up and/or intensifying existing plans. Based on the IPCC report, what may seem like a small change could require large operational shifts. For example, changes in fuel sources at a large scale will be essential.
“The UN Secretary-General has called on leaders to come to the Climate Action Summit in September with clear plans for major cuts to emissions on the pathway to a zero-net emissions economy by 2050,” said Ambassador Luis Alfonso de Alba, the UN Secretary-General’s Special Envoy for the Climate Action Summit, in a statement.
Alfonso de Alba stressed the importance of industry players leading on emissions reduction so that government may follow.
"By sending strong market signals, these companies are showing Governments that they need to urgently ramp up their national plans in line with the latest climate science," the special envoy said.
