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Learn - Deciphering Net Zero

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Countries and companies worldwide are now talking about Net Zero and, on paper at least, an ever-growing percentage of our global economy is committed to achieving this by 2050.

The UK made a legally binding commitment in 2019 to reach Net Zero by this date

Net Zero transition plans need to be consistent with a global temperature rise of no more than

1.5°C above pre-industrial levels. It’s a complex area but, massively simplified, what this means is that businesses need to:


Step One:    Establish baseline carbon emissions NOW.

Step Two:     Reduce them by at least 50% by 2030.

Step Three:  Reach net zero emissions (or at least reduce them by 90%) before 2050.


The Science Based Targets initiative’s (SBTi) Net Zero Standard was launched in October 2021 and provides the most robust framework for businesses to set Net Zero targets aligned with science. It requires an organization to consider greenhouse gas (GHG) emissions throughout its operations including its supply chain.


This is in line with the GHG Protocol Corporate Standard which classifies a company’s GHG emissions into three ‘scopes’:


Scope 1:       Direct emissions from owned or controlled sources, i.e. gas for heating/cooking, and fuel used in company owned vehicles.

Scope 2:       Indirect emissions from the generation of purchased energy, i.e. purchased electricity.

Scope 3:       All other indirect emissions that occur in the value or supply chain, including both upstream and downstream emissions.

Upstream emissions: those that occur in the life cycle of a material/product up to the point of sale by the producer.


Downstream emissions: those that occur in the life cycle of a material/product after the sale by the producer (including distribution and storage, use of the product and end-of-life).

At the time of publication, the SBTi’s certification criteria for Net Zero requires the following commitments:

Near-term:   95% Scope 1+2 reduction / 67% Scope 3 reduction by 2030.

Long-term:  95% Scope 1+2 reduction / 90% Scope 3 reduction by 2050.

The use of carbon offsetting only to neutralize unavoidable residual emissions*


NOTE: There are other decarbonizing terms and frameworks. For example, Carbon Neutrality, which is aligned with British Standards Institution and PAS2060. This differs from Net Zero in several ways. It does not require any specific ambition (such as the 1.5°C pathway). Although encouraged, it does not require Scope 3 emissions to be included. It can be product specific, rather than companywide. And, although carbon reduction plans are encouraged, an organization can jump straight to neutralizing emissions through purchasing high quality offsets and still claim carbon neutrality.



This is another highly complex area, but in short, there will inevitably always be emissions that cannot be reduced any further. So, to reach Net Zero, these unavoidable emissions need to be compensated for (through offsetting) or neutralised (through removal programmes).


For example, for every ton of unavoidable CO2e produced by a company’s business operations, they can fund offset projects to reduce the amount of CO2e in the atmosphere. Common carbon reduction projects include protecting forests, developing clean energy sources, or more efficient energy products.

To ensure that you are offsetting with integrity, always consider the following:




























Taken from The Sustainable Business Book

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