Page 8 - REM Annual Review 2021
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REM                                               MARCH                                                 REM




       20% of world’s corporate





       giants set net-zero targets






       Work towards reaching net-zero targets must be robust, transparent and urgent
       if the Paris Agreement’s goals are to be met, writes Richard Lockhart




        GLOBAL           AT least one fifth of the world’s largest compa-  At present, 20% of the already published
                         nies have set net-zero targets, although such  net-zero targets meet these criteria. While this
       WHAT:             goals could be meaningless if they are not backed  is a good start, and represents how the net-zero
       21% of the world’s 2,000   up by effective governance and transparency.  concept is gaining currency among governments
       largest listed companies   A recent report from the Energy and Climate  and companies, more needs to be done.
       have set net-zero targets  Intelligence Unit (ECIU) and Oxford Net Zero   The lead author of the report, Richard Black,
                         found that 21% of the world’s 2,000 largest listed  Senior Associate at the ECIU, said: “Although net
       WHY:              companies had included carbon neutral com-  zero as a concept is still in its infancy, it is already
       They are responding to   mitments in their corporate strategies.  driving policy change. Clearly though, to keep
       the maturing concept of   Meanwhile, over 50% of the 2,000 compa-  the world on track to global climate targets we
       net zero          nies have set interim targets, a published plan  need more countries, states, regions and compa-
                         and a reporting mechanism, but no net-zero  nies to sign up to targets and existing pledges to
       WHAT NEXT:        commitment.                          be improved.
       More needs to be done in   Just over 25% has also signed up to a full set of   “There is logic to setting a target and then
       the short term to ensure   what the report calls “robustness criteria”.  building a plan and reporting mechanisms to
       that interim targets are   The report, called Taking Stock: A global  meet that, but companies and countries alike
       in line with longer-term   assessment of net zero targets, examined net-  will need to make progress on this in the run-up
       2050 pledges      zero commitments made so far by major compa-  to COP. Countries such as Japan and the US will
                         nies, as well as national and local governments.  need to back their net-zero ambitions with near-
                           The report also found that authorities in 61%  er-term 2030 emissions targets.”
                         countries, 9% of states and regions in the largest   For example, while Japan has set 2050 as its
                         emitting countries and 13% of cities with popu-  target date for net zero, its interim targets for
                         lations of over 500,000 had now made net-zero  2030 were recently criticised as not being robust
                         commitments.                         enough, thereby reducing the credibility of the
                           Taking both companies and governments  country’s long-term goals.
                         together, 769 out of 4,000 entities surveyed
                         (19%) have a net-zero target in place. The com-  Lack of clarity
                         mitments cover at least 61% of global green-  The report also identifies a lack of clarity around
                         house gas (GHG) emissions, 68% of global GDP  how countries and companies alike will use
                         (assessed in purchasing power parity terms) and  offsetting, rather than actual cuts in emissions
                         56% of the world’s population.       by industry, power generation and transport,
                           However, the report stressed that targets and  to meet targets. It identified the extensive pro-
                         policies are not enough, and that the world’s cor-  posed use of forestry as a carbon sink as being
                         porate giant could be vulnerable to allegations of  difficult, as there no planetary limits on nature-
                         “greenwashing” if they do not put in place proper  based offsets.
                         governance and transparency mechanisms,   Co-author Dr Thomas Hale from the Blavat-
                         including how much offsetting they rely on.  nik School of Government, University of Oxford
                                                              said: “While the rapid uptake of net-zero targets
                         Targets                              is encouraging, we need much more clarity from
                         The research as comes as major emitters such  actors on how they plan to get there. It’s particu-
                         as China, India, Japan, the US, the UK and the  larly important that actors clarify their approach
                         European Union have made net-zero commit-  to offsetting. Although some offsetting may be
                         ments for 2050 or 2060 at the latest, as well as  needed for so-called “residual emissions” in
                         major fossil fuel companies such as Royal Dutch  certain sectors, the most important priority
                         Shell and BP.                        is immediate emissions reductions. If every
                           The report rates various targets from compa-  company and country relies on offsets and not
                         nies and government on the extent they achieve a  enough on actual emission cuts, we simply won’t
                         certain minimum set of robustness criteria, as set  be able to accommodate these globally.”
                         out by the UN Race to Zero Campaign.   With 124 countries now committed to or



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