What new trends have emerged this year when it comes to environmental sustainability in the corporate world?
And what corporate environmental sustainability trends have picked up momentum in 2021 from last year?
From net-zero pledges becoming the norm in many industries to ensuring supply chain resilience, SINAI provides five key insights into meaningful and robust corporate environmental sustainability in 2021:
Net-zero pledge emerging as an industry standard
Companies pledging net-zero emissions this year is one of the fastest-growing corporate environmental sustainability trends. According to the experts, achieving net-zero by 2050 is vital to protecting the planet from the catastrophic consequences of global warming.
The number of companies making net-zero emissions commitments doubled in 2020, as many continue to prioritize real action on climate change during their continued recovery from the economic impact of COVID-19.
You could say corporations are in a race to zero emissions, given the climate science underpinning the pledge is so widely accepted. Also, net-zero reduces cost and risk while attracting environmental, social, and corporate governance (ESG) investors and top talent. Reducing your carbon emissions and, in particular, reaching net-zero emissions is an effective way to hedge against rising carbon taxes in many countries and position your company as an industry leader when it comes to environmental sustainability.
On the other hand, a lack of standards for net-zero roadmaps has deterred many companies; tech companies have become the leaders in setting lofty net-zero goals. Even net-negative heavy-emitting industrial and utility sectors have struggled to identify roadmaps to meet any science-based targets. Learn more about how corporations become carbon neutral in our recent blog on the topic.
A robust approach to meaningful goal setting
Accurately calculating what a corporation needs to do to meet emissions targets they set often leads to an understanding that incremental improvements are not sufficient, and innovation is required in order to reach the set environmental sustainability goals.
Meaningful and science-based goal setting can help companies make measurable and actionable plans when it comes to critical environmental thresholds. By taking a science-based approach, companies can also scale up action to meet ambitious 2050 net-zero targets.
Supply Chain Resilience
COVID-19 triggered unprecedented disruptions to supply chains worldwide and put a magnifying glass on the weak spots in supply chain models built for maximizing efficiency at the expense of sustainability and resilience.
If we learned anything in the last year, concerns regarding environmental sustainability, transparency, and supplier diversity are gaining traction with customers and investors. Corporations looking to review, reform, and bolster their supply chains will need to ensure reliability, compliance, and safety and analyze how each of their supply chains can play a vital role in the corporation’s efforts to promote environmental sustainability, accessibility, and equality.
Accelerated and integrated disclosure
Last year we saw five major reporting frameworks put meaningful effort into creating standardized and comparable ESG disclosures. The Carbon Disclosure Standards Board (CDSB,) the International Integrated Reporting Council (IIRC,) the GRI, the Sustainability Accounting Standards Board (SASB,) and the CDP (formerly the Carbon Disclosure Project) all committed to developing a comprehensive corporate reporting system.
With ESG reporting now very much in the mainstream and reporting standards finally to come together, companies that have yet to regularly publish ESG reports can expect to face increased pressure from investors to do so, and for corporations that have already made ESG disclosures to continue to improve the quality, comparability and scope of their disclosures.
As we enter the second quarter of 2021, a growing focus on how corporations provide assurance and verification for their ESG data continues. Board members and directors need to decide how to ensure that internal reporting processes lead to verifiable and accurate data.
Embedding climate into financial risk management
In 2021, a more strategic approach is necessary to achieve the change needed to protect the environment and tackle climate change. That approach needs to consider the need for a transition to a resilient and low-carbon future and embed near-term climate factors into every company’s existing financial risk management strategies.
Such frameworks need to take into account and build a collaborative environment across a company’s various departments to review and input to risk and capital strategies, addressing the multi-dimensional nature of climate opportunities and risks.
Accurate and accessible emissions data
SINAI’s software makes it easy for companies to consolidate and organize data from multiple sources in order to accurately report and make more informed business decisions.
We make it possible for you to go beyond capturing emissions inventories and reporting with the dynamic scenario assessment tools we’ve built, including a marginal abatement cost curve and carbon pricing modules. Our software solution can significantly benefit corporations looking to take the deep decarbonization lead in their industry, whether that may be utilities, transportation, materials, consumer goods, or real estate.
Additionally, SINAI brings your financial team into the mix and offers intelligent data integration for cutting-edge risk management, helping you bring your carbon strategy directly into your company’s business model.
Contact us for a demo of our software today!