Companies with a net-zero goal reduced
emissions by 10% on average over the last decade; those without
targets saw emissions increase
Corporate commitments to net-zero accelerated over the last two
years, with almost one-third (30%) of Europe’s largest listed
companies now having pledged to reach net-zero by 2050, according
to a new study by Accenture (NYSE: ACN).
The Accenture study, “Reaching Net Zero by 2050,” analyzed data
from more than 1,000 listed companies across Europe’s major stock
indexes, finding that setting targets helps accelerate the
transition to net-zero — i.e., where a company reduces its
emissions of CO2 and other greenhouse gases (GHG) to zero or
offsets the remainder to achieve a balance between the amount of
GHG emissions produced and the amount removed from the atmosphere.
Last decade, the companies with a net-zero goal reduced their
emissions by 10% on average, while those without targets saw their
emissions increase.
Companies listed in the U.K. were the most likely to have set a
net-zero target date, covering scope 1, 2 and 3 emissions*, with
37% having done so, compared with 27% in Germany and 18% in
France.
The average net-zero target year for European companies included
in the study is 2043. Many companies in carbon-intensive industries
— such as oil and gas and chemicals — have set net-zero target
dates of or close to 2050, while many in services sectors aim for
around 2035.
“The European business community is more engaged than ever in
the race to zero, with the number of companies publicly setting
goals having grown over the last two years,” said Jean-Marc
Ollagnier, CEO of Accenture in Europe. “And as our study shows, the
targets work. Net zero should be managed as any strategic business
priority: set clear objectives to drive the entire organization to
the same direction, and monitor progress to correct the trajectory
as appropriate. Making targets public also helps create the
required collective momentum, as companies can’t solve it
alone.”
Accelerated action needed as just 5% of companies on track to
meet their targets
However, the study found that just one in 20 (5%) of the
European companies in the study are on track to achieve their
net-zero target dates in their own operations, covering scope 1 and
2 emissions, if they continue the pace of emissions reduction that
they achieved between 2010 and 2019, with only 9% on course to meet
a 2050 target. Companies that have achieved modest emissions
reduction since 2010 — i.e., 0-5% reduction per year —can still
reach net-zero in their operations before mid-century if they
double the pace of emissions reduction by 2030 and triple it by
2040.
“Though the number of newly set targets is reassuring, it is
still clear that organizations are not moving fast enough,” said
Peter Lacy Accenture’s chief responsibility officer and
Sustainability Services global lead. “With COP26 just a few weeks
away, businesses and governments across all parts of the world need
to focus their efforts on concrete action that follows robust
targets to meet the challenge our world faces to reach net zero by
mid-century and hold global warming to 1.5°c.”
The report suggests specific solutions and stepping-stones to
net zero for select industries, including automotive, chemicals,
construction, finance, retail and transportation.
It also shows that seven industries — mostly in service sectors
such as professional services and information and communications —
will be on track for net-zero in their operations by 2050 if they
double the pace of emissions reduction in this decade, and then
accelerate another 50% to 70% in the following 10 years. More
radical acceleration will be needed for five sectors representing
42% of GHG emitted by all companies in the research sample —
automotive, construction, manufacturing, oil & gas, and
transportation & storage — to reach net-zero by
mid-century.
“Net-zero by 2050 — let alone sooner — will be feasible only
with swift, decisive action in this decade. Our findings show that
it is possible, but only if European businesses act now,” Ollagnier
said. “Solutions differ by industry and company, and all have
different starting points, opportunities and challenges. In some
industries, the required technologies are available and will need
to be scaled at speed. In others, they will have to be invented.
However, getting there will require all businesses to make
reinvention the norm, driven by technological innovation,
collaboration, new business models and supportive regulation.”
For more information and to view a copy of the report, please
visit: Reaching Net Zero by 2050.
* Scope 1 emissions are GHG direct emissions from
companies’ own and controlled resources. Scope 2 covers indirect
emissions from the generation of purchased energy — i.e., purchased
electricity, steam, heating and cooling consumed by the reporting
company. Scope 3 includes all other indirect emissions that occur
in a company’s value chain.
About the Research
The research is based on data collected by Retail Economics
about the net-zero targets (covering scope 1, 2 and 3 emissions) of
1,022 of Europe’s largest listed companies: 269 on the FTSE, 237 on
Euronext Paris, 228 on the Deutsche B�rse, and 288 on other
Euronext exchanges, including 73 Italian companies and 54 Spanish
companies. Researchers analyzed the emissions from 2010 to 2019 of
companies in the report sample, focusing on the absolute scope 1
& 2 emissions (excluding scope 3 to avoid double counting), and
the compound annual reduction rate (CARR) of emissions over the
10-year interval was calculated.
Projections of potential emissions reduction pathways for each
company in the dataset were built to estimate in which future
five-year time interval the company is likely to reach net zero. An
“S-curve” shape was chosen for the projections, in line with
existing expert scenarios for emissions reduction by industry.
Company-level projections to industry and country level were
aggregated to assess the time period over which companies in the
industry and country are likely to achieve net zero. Finally, the
net-zero target years were compared with the time interval
resulting from the emissions pathway analysis.
About Accenture
Accenture is a global professional services company with leading
capabilities in digital, cloud and security. Combining unmatched
experience and specialized skills across more than 40 industries,
we offer Strategy and Consulting, Interactive, Technology and
Operations services — all powered by the world’s largest network of
Advanced Technology and Intelligent Operations centers. Our 624,000
people deliver on the promise of technology and human ingenuity
every day, serving clients in more than 120 countries. We embrace
the power of change to create value and shared success for our
clients, people, shareholders, partners and communities. Visit us
at www.accenture.com.
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version on businesswire.com: https://www.businesswire.com/news/home/20211006005818/en/
Francois Luu Accenture +33 1 53 23 68 55
francois.luu@accenture.com Andy Rowlands Accenture +44 7952 594784
andy.rowlands@accenture.com
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