Net-zero commitments are gaining momentum fast. We’re here with a guide to ensure you’re not left behind.
As an approach that helps companies drive innovation, cut costs, and attract investors, it’s a popular choice and is becoming a cornerstone of corporate sustainability strategies.
This guide will explain what a net-zero commitment means, why it matters, and how to set, share, and actually hit your targets using a science-based, data-driven approach.
What is a net-zero commitment?
A net-zero commitment is split into two essential parts:
- First, your company must reduce greenhouse gas (GHG) emissions across Scopes 1, 2, and 3 to as close to zero as possible.
- The remaining emissions must be permanently neutralised, usually through carbon removal or offsetting, to bring your total emissions balance to zero.
It’s built on these key elements:
- Near-term science-based targets: 5-10 year milestones that create immediate momentum.
- Long-term targets: Your destination point, typically no later than 2050, with a defined base year (after 2015).
- Comprehensive scope: A commitment to mitigate direct emissions and those from the broader value chain.
This structure makes sure you have the clarity and accountability needed to turn your sustainable ambitions into tangible results.
Why a net-zero commitment matters
What makes a net-zero commitment more than just another pretty pledge?
Beyond helping the environment, setting a net-zero target has proven to deliver serious business advantages.
Think of it as an investment with some impressive returns:
- Better access to funding: Improve access to green funding and loan terms as investors look for companies with solid sustainability plans.
- Smarter business planning: Create a roadmap for the shift to a low-carbon economy, avoiding investments that conflict with the Paris Agreement and won't make sense in the future.
- Stronger relationships: Build trust with investors, customers, and partners by reporting your climate progress.
- Real climate impact: By helping limit global temperature rise to 1.5°C, you will protect the planet and your company's reputation.
A net-zero commitment can reinforce credibility, inspire innovation, and facilitate new partnerships.
Setting your net-zero commitment: Where to begin
Creating a net-zero commitment is like planning a road trip, you need a starting point, a destination, and key stops along the way. Without a clear plan, you'll likely waste time and resources.Start with these basic steps:
- Define your targets
- Set near-term targets, covering the next 5–10 years, alongside long-term targets that should be reached by 2050 at the latest.
- Use the same base year for both and make sure it’s no earlier than 2015.
- Share the targets publicly
- Share your target year, near and long-term emissions reduction goals, and the base year you’re using.
- Create your reduction and neutralisation plan
- Map out your actions across scope 1, 2, and 3 emissions, and explain how you plan to handle any leftover emissions after hitting your target.
- Think beyond your direct operations, look upstream and downstream at your wider supply chain for more ways to cut emissions.
Managing your carbon footprint doesn’t have to be complicated. With solutions like Plan A, you get a certified carbon management platform that combines data collection, measurement, and reporting into one easy-to-use tool. Plan A’s decarbonisation target-setting tool even follows SBTi standards, so your team can focus on making a real impact, without the stress.
How to communicate your net-zero commitment
Rule #1: Don’t overcomplicate things.
While a well-placed piece of jargon can be helpful, your goal should be to turn the complex details of your net-zero commitment into a story that everyone can follow.
Clear communication builds trust and can be a key reason as to why stakeholders buy-in.
It’s important to remember that you’re not just talking to people outside your company. Employees, shareholders and suppliers all need to be a part of your communication strategy.
That’s why companies should adopt both internal and external approaches through:
- Target transparency: Share specific details about your target year, baseline year, and reduction ambitions for both short and long-term goals.
- Sharing plans: Explain the investments, partnerships, and technologies you'll use, like carbon removal initiatives, to support the target. This will show people that your commitment is backed by real action.
- Engaging stakeholders: Create specific approaches for employees, suppliers, communities, and investors in the transition process. This includes regular progress updates and third-party verification to validate achievements.
Note: The most trusted companies don't just talk about their wins; they're honest about challenges, too. People have more confidence in your overall strategy when you're open about difficulties while showing a clear path forward.
Avoiding greenwashing risks
Voluntary reporting standards require ensuring communications don't contradict mandatory information, maintaining less prominence than required disclosures, and providing supporting detail explaining disclosure basis and methodological differences.
Balanced impact reporting presents both positive and negative impacts to maintain credibility, avoiding cherry-picking particular products whilst transparently addressing all material emissions source.
Challenges and pitfalls to avoid
The path to net-zero is more like hiking through varied terrain than walking a straight line; you're guaranteed to encounter obstacles along the way.
Knowing these common challenges can help:
- Data and measurement difficulties: Look at inaccurate or missing data as gaps in your map; you can't navigate properly with an incomplete picture. Most companies can struggle with gathering detailed data, especially regarding Scope 3 emissions.
- Complex target setting: Balancing near-term and long-term targets can be challenging, especially for businesses with a wide range of products or more growth-focused strategies.
- Communication inefficiencies: Technical language often confuses non-experts, and what makes sense to sustainability teams might sound like jargon to others, leaving internal and external stakeholders confused.
- Structural changes: Mergers, acquisitions, or shifts in business strategy can require changing targets, making it harder to track progress.
Working around these challenges requires efficient data management, clear internal guidelines, and transparent communication supported by specialist tools.
Carbon management platforms like Plan A help manage data flows and target tracking, guiding companies through roadblocks while ensuring they remain compliant and audit-ready.
Net-zero strategies
Reaching net-zero is more like running a marathon than a sprint. It requires planning, steady effort, and the proper support.
Here are some helpful strategies:
Supply chain engagement
Most companies discover that their biggest carbon impact is outside their direct control. So, what can we do to help this?
- Start supplier engagement programmes to address emissions in the supply chain. Studies show that emissions from your supply chain are often larger than those created through direct operations.
- Use workshops, coaching, and e-learning modules to help suppliers build the skills, knowledge and resources they need to work alongside your decarbonisation targets.
Leading companies often build two-way relationships with their suppliers, sharing tools, insights and support so everyone thrives. This kind of collaboration can boost efficiency and speed up emissions reductions.
Financial and operational planning
Your climate strategy needs to be part of your business plan, not separate from it:
- Revisit your strategic and operational priorities to make room for low-carbon investments, such as sourcing renewable energy or new energy-saving tech.
- Use internal carbon pricing and dedicated CAPEX/OPEX budgets to focus investments on boosting both sustainability and business performance.
Integrated communication and verification
Transparency builds trust that helps during challenging times:
- Regularly report progress through clear dashboards and visualisations. This transparency builds trust and allows for appropriate adjustments to your strategy.
- Make use of third-party verification and share yearly progress reports to maintain accountability with stakeholders.
Leveraging technology and expertise
Modern carbon management is like using a fitness app instead of manually tracking exercise, the right tools make everything easier:
- Incorporate data-driven insights using tools for automated data collection and emissions measurement, simplifying regulatory compliance and highlighting opportunities for reduction.
- Refine your decarbonisation strategies using predictive analytics and scenario modelling, which are provided by platforms like Plan A's decarbonisation solutions.
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These strategies guide companies in improving their operational efficiency and leading the way in corporate net-zero achievements.
Taking on a net-zero commitment can feel overwhelming, but companies that approach it step by step find it an achievable journey rather than an impossible task.
The most successful companies share key traits: they make climate action part of their core business, communicate openly with stakeholders, and use technology to handle the complexity of tracking and reducing emissions.
What separates companies that discuss climate goals from those that achieve them? It's the blend of ambition and practicality, setting science-based targets while building flexible systems that adapt to changing business conditions.
Your net-zero journey won't always follow a straight line. You'll face challenges with data, target setting, implementation, and possibly more. However, by seeking support with advanced solutions like Plan A, you won’t have to face these issues alone.
Want to speak to our team of experts about how we can support your net-zero commitment? Consider booking a demo today.
