Net Zero 2050 is now enshrined in law and more and more organisations are creating an action plan for a 1.5° future.
Many small business businesses know they need to meet the challenge and pledge to Net Zero, but they don’t know where to start.
One reason? There’s a lot of jargon involved in the carbon emissions conversation. And for a small business wondering how they can combat climate change, the jargon can be paralysing.
This blog post aims to make it simple. By the end of this post you will understand the fundamental things you need to know on your net zero journey, and you’ll leave with a list of meaningful actions you can take to get started.
Let’s start with some carbon literacy.
What are greenhouse gases?
In the conversation about climate change, we talk a lot about carbon and very little about the other greenhouse gases at play in the atmosphere. Methane, for example, is actually far more potent (but far less long-lived) than CO2.
Greenhouse gases, such as carbon dioxide (CO2), methane, and nitrous oxide, have a unique role in regulating the Earth’s temperature.
They function by trapping heat within the atmosphere, creating a warmer climate than it would naturally have.
When sunlight reaches us, it does so in the form of visible light. However, when this energy leaves the planet, it transforms into infrared radiation, which we perceive as heat. Greenhouse gases act like a filter for this infrared radiation, causing a portion of the heat escaping Earth to rebound back towards the surface.
So, they’re called “greenhouse” gases because they function similarly to the glass panels of a greenhouse, allowing sunlight to enter but trapping heat inside.
What are scope 1, 2 and 3 emissions?
Scope 1, 2, and 3 emissions are different categories used to measure a company’s greenhouse gas emissions. These classifications are part of the Greenhouse Gas Protocol, a widely recognised accounting framework for tracking and reporting emissions.
These three scopes help organisations understand and tackle their carbon footprint. They cover emissions both directly under your control and those throughout your entire value chain.
The scopes and how they apply to an SME:
- Scope 1 emissions: Where you burn fossil fuels. Think gas boiler, or fuel in your vehicle.
- Scope 2 emissions: Where someone else is burning fossil fuels for you. Think indirect emissions like electricity generation.
- Scope 3 emissions: All the indirect emissions. Think employee home working, employee commuting and goods and services you buy in. If you’re a product business, the use of your product and its end of life disposal. Finance emissions, like pensions or savings.
The most important thing to know about scope 3 is that it’s the majority of all business emissions. And it’s not necessarily within your control. You can’t tell all your suppliers to do better at Net Zero.
The SBTI acknowledges the fact that (unlike big business) SMEs don’t have control of their supply chain in the same way.
The SBTI (Science Based Targets Initiative) is a collaborative effort between several influential organisations, including CDP, UN Global Compact, World Resources Institute (WRI), and the World Wide Fund for Nature (WWF). It is the leading global framework for defining Net Zero.
Big corporations in a supply chain are required to be 50% by 2030 and full Net Zero by 2050. They have to do that across all 3 scopes.
For SMEs it’s the same requirement for scopes one and two, with a commitment to reduce scope three.
So what do we need to do to achieve Net Zero?
Net Zero refers to the point at which the total greenhouse gas emissions released into the atmosphere from human activity is equal to the amount removed.
The concept of Net Zero is that you reduce your emissions as much as you possibly can, and then balance out what you can.
And that might look like:
- Investing in more reliable technologies – for example Direct Air Capture (DAC) where you are literally taking carbon out of the air and putting it into the ground for centuries.
The problem with investing in these technologies is it’s very expensive. Which is why many business owners choose to focus on carbon offsetting. Let’s look at that in more detail…
What is carbon offsetting?
The concept of carbon offsetting is simple. You balance out your carbon emissions by investing in projects that decrease or restore carbon. What you produce in one area, you reduce in another. The scales even out and job done: you’re “carbon neutral”.
Except it’s not that simple in reality.
Our carbon emissions don’t work on a neat and tidy like-for-like basis. If you burn fuel today there is carbon in the air today. How many trees does a frequent flyer need to plant to offset their carbon footprint? How do we count the years those trees are still saplings?
For this reason, the term “carbon neutral” is being recognised as a massively problematic claim for businesses to make. You can read more about carbon offsetting in our dedicated blog: Why carbon offsetting is problematic (but you should do it anyway).
Because here’s the thing: pulling investment out of offsetting projects is not the answer.
Plant trees anyway and invest in certified carbon offsets
We plant trees because it’s good. Because even when globally we hit the nirvana of Net Zero, there’s still too much carbon in the atmosphere and it needs to be drawn down. Trees are the ideal tool for that job.
Instead, we buy certified carbon offsets through Ecologi.
That’s things like:
- Solar renewable energy projects we have paid money towards
- Protecting rainforests
- Buying solar stoves for people who would otherwise be burning solid fuel
See how we’re planning, measuring and tracking progress on our Net Zero page.
It’s not a perfect plan, because the concept of Net Zero isn’t perfect.
Because there is this business case around Net Zero, it will remain important to demonstrate that the balancing between emission and offsets is being done. But be careful not to claim you are Net Zero or carbon neutral unless you’ve done the hard work of dramatic reduction.
Wondering where to go from here? Decide to do 1 thing to reduce your carbon footprint today. And then do it.
Here are 10 quick wins for SMEs who want to take climate action. These are easily accessible things all businesses can do as a starting point.
Signing up to Ecologi was the first step for us, and you’ll see that at the top of the list. But it might look different for you.
Empower your team to lead this charge too. Have them read this blog, understand the fundamental concepts and be part of your pledge.
They will take the mindset home with them, and your business can be an impactful node in a web of climate action spreading out amongst all stakeholder groups as they see and are inspired to build upon your positive climate action.