How to Set Smart Carbon Goals
Enjoy this blog from the SSC archives: Every company needs smart carbon goals -- and this is especially true if you are a Walmart supplier (or sell to a retailer with a similar sustainability scorecard). But what makes a good carbon goal? You don't want to be too ambitious and fall short, but you also don't want to set such easily attainable goals that you look lazy. What is the right middle ground? Before we jump in, we want to mention that there is much disagreement in the sustainability industry about what an appropriate carbon goal is -- and what companies should be aiming for. So please take our opinion with a grain of salt. What works for you might be different that for another organization. Ok, let's get into it.
Should you set a goal of carbon neutral?Maybe. It's an admirable goal, and we love BHAGs. However, there are two main problems that we see with carbon-neutral goals. First, it's easy to slide from a meaningful effort to reduce carbon-generating activities into a focus on buying your way out of the problem with RECs and carbon offsets. Second, the challenge of zero carbon is so big that it can be overwhelming. Avoid these two problems by 1) keeping the emphasis on carbon reduction, and only purchase carbon offsets to mitigate truly unavoidable impacts, and 2) creating a year-by-year plan with shorter goals that get you to carbon neutral.
Should you set a goal aligned with IPCC guidelines?Yes. The IPCC report is the go-to place for understanding global carbon thresholds. In it, scientists tell us we must reduce the amount of CO2 in the atmosphere from its current level of 392 parts per million ("ppm") to below 350 ppm. That equates to a global reduction in carbon emissions by 80% by 2050 (against 1995 baselines). (Read more about the science here). In order to honestly say that you are "doing your part" to stop climate change, your company should be aiming to reduce its carbon footprint at this same rate. (If you're interested in learning more, please contact us -- we have access to tools that can help you figure out what IPCC guidelines mean for your company on a year-by-year basis!)
Should you set a modest 5% - 10% goal?Maybe. It's better to have a modest goal, rather than no goal. But our general feeling is that these types of goals are mostly suited to extremely short timeframes -- like 1-3 years. And that's great, particularly if you are just starting out and need some quick wins to build momentum. But don't overlook the bigger picture. It's critical to understand where you need to be in the long run (20-50 years from now). Focusing on that horizon will help you consider the carbon implications of capital investments, supply chain development, mergers and acquisitions, and new product development.
Should you set goals beyond tons of CO2-e?Yes. There are lots of ways to set carbon goals. And while an absolute reduction in tons of CO2-e is a vital element of a carbon management plan, it is not complete. Consider the following to round out your approach:
- Adjusted carbon goals (like carbon-per-production-unit, or carbon-per-$-revenue) will help you determine how your carbon efficiency is changing as you grow (or shrink) your organization.
- Employee engagement goals (like % of employees trained on carbon reduction initiatives) will help you measure how far into your organization you have embedded your mission.
- Supply chain goals (like % of suppliers reporting their Scope 1 and 2 emissions) will help you track how much of your Scope 3 emissions are covered, and how much you are leveraging your value chain towards sustainability.