By Izzy Cronin and Andrew Benoy

Consumers and regulators are putting increasing pressure on organisations to show their commitment to cutting global emissions.

Previously many companies simply purchased carbon offsets to reach their environmental targets. But in recent months Australia’s carbon credit market has faced significant scrutiny. The former head of the Emissions Reductions Assurance Committee, Professor Andrew Macintosh, said the scheme was “largely a sham” as most credits issued did not represent real or new cuts in greenhouse gas emissions.[1]

Given the limitations of offsets, it is clear the real solution lies in reducing emissions and changing practices across organisations – in ways that stick.

It is encouraging to see many organisations committing to action. In the latest federal budget, funds were committed to help the Australian Public Service reduce its greenhouse gas emissions to net zero by 2030.

Whether it is convincing senior leaders to invest in research and development to reduce your emissions, transitioning to renewable energy or mobilising your workforce to choose low-emissions travel options, your staff and senior leaders will be at the heart of a successful transition to net zero.

We have identified four steps that are critical for organisations seeking to get to net zero.

1. Understand the scale: Map your current footprint and identify realistic reductions

Before you embark on the journey to net zero you need to understand the size and scale of the change. This means making an upfront investment in calculating and baselining your organisation’s current footprint.

You then need to develop emissions reduction pathways and analyse the time required and relative contribution of different pathways to reach net zero.

Emission reduction pathways comprise activities for your organisation to shrink your footprint. For example, to reduce your electricity emissions you may switch to green power, improve the energy efficiency of your facilities and install solar panels.

Carbon reduction activities generally fall into two categories:

A good strategy will encompass both but will typically lean more heavily on company-led activities.

Developing emissions reduction pathways will require frank and honest conversations about the scale of the opportunity and challenge. As consumer expectations and government regulations continue to evolve continued investment is likely required to maintain reputational benefits and meet mandatory requirements.

2. Engage leaders for action: Make the case at all levels of your organisation

A big challenge in reducing your emissions is moving your organisation from understanding to action. Most people generally agree that we need to reduce our emissions, but may not be compelled to take action. The surest way is to get your organisation on board is to take them with you on the journey.

This journey starts with gaining widespread understanding of, and commitment to, your organisation’s goals. In your change communications and planning you need to think critically about how you can make your case at all levels of your organisation based on the action required by them.

Talk to your staff to understand the barriers and enablers, as these become your levers for change. some typical barriers and enablers for leaders and staff:

There are several strategies for addressing these barriers and enablers, including:

• Carrot and stick. If your leadership team is concerned about the additional investment required to, say, switch to renewable energy, build a compelling business case that includes the benefits of switching (the carrot) and the risks of not switching (the stick). It is also helpful to appeal to the heart as well as the head – people generally want to do the right thing for current and future generations.
• Changing defaults. For staff, where the greatest barrier is often inconvenience, the most successful enablers often involve changing default options. As an employer you could consider changing your organisation’s default superannuation provider or removing bins under desks.

3. Build and mobilise: Create momentum and excitement while managing expectations

You now need to harness enthusiasm while being deliberate about your scope.

Once you have made the case for change across your organisation you will be constantly approached by early adopters who have good ideas for reducing your emissions – but your resources are unlikely to be able to accommodate these. A few activities will make the greatest impact in reducing emissions, and these should be the focus of investment and executive energy.

You need to constantly manage people’s expectations on what is possible; managing the scale of the task will be an exercise in restraint. Staying focused is crucial, but this needs to be balanced with momentum-building activities to keep people engaged.

One highly effective way to balance these competing interests is to facilitate bottom-up action through employee networks. Change is most effective when driven top-down and bottom-up. Having change champions (‘boots on the ground’) can achieve buy-in and give you access to resources to deliver more momentum-building activities. In many cases early adopters are willing to become your change champions and – with proper support – implement their own ideas.

4. Make it stick: Embed the journey to net zero in your business as usual

The final step is setting up structures and processes to ensure your carbon reduction policies are adopted in your ways of working. This includes:

• Build carbon reduction into KPIs. Establish key performance indicators and build a performance dashboard to track whether carbon reduction policies are consistently followed.
• Regularly report on the measurement results. Celebrate success and hold your organisation to account by embedding targets and performance metrics in enterprise or impact reporting. For example, a KPI measuring the success of a new recycling policy may involve measuring changes to the total waste to landfill.
• Identify opportunities for improvement. As you mature your net-zero program, you will likely make mistakes, such as making incorrect assumptions or introducing reduction activities that bring negative externalities (for example, encouraging recycling without proper education and/or signage can increase contamination). That is okay; net zero is a process of continuous improvement.

In an environment where many organisations are still learning, and there is little consistency in international frameworks, strive for honesty not perfection.

Here at Nous we are raising our ambition

Since our inception in 1999, Nous has been committed to achieving positive influence, including taking action on sustainability.

We commenced a dedicated decarbonisation program in 2016. This involved developing a carbon accounting model aligned with the greenhouse gas protocol, purchasing electricity from a carbon-neutral provider, and offsetting our emissions.

Four years later, the global pandemic hit and fundamentally changed the way we work, interact and travel. Due to the travel bans, our emissions reduced by over 50 per cent. Ideally, we would have sought to continue to reduce those emissions going forward. But the practical difficulties this posed meant we instead focused on purchasing fully verified offsets – we were stuck in step 1.

We emerged from the pandemic with a renewed focus, and in 2022 created the role of Sustainability Manager to embed sustainable ways of working. This has helped us to rapidly move through steps 2 and 3. We set net-zero targets aligned with the Science Based Target Initiative,[2] identified levers for change and achieved buy-in from our CEO and Executive Board to implement carbon reduction procurement and travel policies.

The decades ahead threaten rapid, widespread and intensifying risk from climate change. The collective action required to limit global warming to well below 2°C requires a new level of openness and transparency (including from us). We are now working on step 4 to build in net-zero targets in our enterprise reporting and contribute to an honest discussion about the scale of change required.

Our own experience on this journey gives us an appreciation of the challenges and opportunities it provides.

Get in touch with our decarbonisation and culture change experts to discuss how you can meet your net-zero targets.

Connect with Andrew Benoy on LinkedIn.

Co-written with Izzy Cronin and prepared with input from Sarah Connelly during their time at Nous Group.

Published on 16 May 2023.

[1] The Guardian, Australia’s carbon credit scheme ‘largely a sham’, says whistleblower who tried to rein it in, March 2022

[2] World Resources Institute, Science Based Targets initiative (SBTi)