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Six steps to carbon neutrality

Author: ICAEW Insights

Published: 12 Jul 2021

With most national and international climate goals aiming for net-zero by either 2030 or 2050, the challenge is now firmly set for everyone to play their part, including your organisation. We outline the high-level steps on the road to carbon neutrality.

Beyond introducing emission-reducing measures such as recycling office waste, purchasing FSC certified paper for printing and switching to renewable electricity, the decision to go further and become carbon neutral can be a daunting one. Many organisations of all sizes and types can struggle to know where to start and how to progress. 

Carbon neutrality for an organisation means reducing its Co2 emissions to zero. Getting to zero comes through a combination of in-organisation reduction and elimination measures. Alongside this, external emission reduction projects, such as offsets, tackle any residual emissions.

We can break this process down into six simple steps.

1) Measure your carbon footprint annually

Knowing how many tonnes of carbon dioxide (Co2) your organisation emits is a vital first step towards reduction efforts. Annual measurement helps you to track your progress over time. The exercise also gives an insight into the areas of operation that create higher carbon dioxide emissions, which helps determine where you should direct action.

To measure your Green House Gas (GHG) emissions (of which Co2 is a part), ideally, all emissions in the corporate’s value chain should be identified and included. Emissions are categorised under three scopes, with scope I the direct and most controllable silo of emissions. 

The first move is defining where the boundaries lie and what to include in each scope. Next is collecting and collating the relevant data on energy consumption, corporate travel, etc which is converted into Co2 equivalents.

ICAEW participates in the CDP scheme, a comprehensive exercise that produces a score at the end, areas for improvement year on year and a Co2 measure of its footprint.

2) Identify and implement emission reduction actions

Now that you have your carbon footprint and identified your carbon hotspots, it’s time to set out an action plan with timeframes and indicative costs. You can start introducing these at any stage. ICAEW had already reduced its emissions by 20% (from its 2015 baseline figure) before embarking on its carbon-neutral project.

Initial reduction measures could include renewable power providers for gas and electricity, installing LED lighting, and introducing a thorough recycling strategy. For instance, ICAEW adopted a comprehensive approach to recycling at Chartered Accountants’ Hall some years back. Food waste is anaerobically digested; no waste goes to landfill. Any incinerated waste produces RDF (Refuse Derived Fuel) and building materials.

3) Decide on your strategy and set an ambition

As covered in a previous article on the ICAEW's journey to carbon neutrality | ICAEW, support and drive from the top are needed to define your strategy's ambition and support the necessary financial investment

Take a series of proactive yet achievable steps, but with stretch and ambition built-in. You also need to develop a means of tracking progress towards achieving your targets. 

4) Create a roadmap

A detailed plan or roadmap is a core deliverable, setting out the next level of emission reduction projects (e.g. boiler replacement), with timeframes and indicative costs. This document also sets out reduction targets. Consider how to oversee the investment process and to measure and report on progress.

As an organisation, ICAEW commits time and resources to keep emissions on a downward trajectory. With the additional carbon saving projects identified as part of our carbon neutral roadmap, we aim to reduce emissions by a further 20% by 2025 and by an overall 40% by 2030. 

5) Offset where necessary

Offsetting should not be considered as a standalone measure. Whatever approach or timeframe you adopt to reduce carbon, some residual emissions will likely remain in the organisation. This is where offsetting becomes part of your strategy.

When selecting offset providers and projects, look for sound measures of assurance and verification standards in addition to access to regular progress reporting on outcomes. While there is no formal global offsetting standard, several voluntary assurance standards exist to prove the efficacy and effectiveness of the underlying projects – such as VCS or the Gold Standard. Also, consider projects that contribute to achieving the UN SDGs.

6) Think about communication

Consider how to communicate your progress to internal and external stakeholders. Encourage others to improve their sustainability credentials, whether customers or suppliers. There will be more mandatory reporting and compliance requirements in this space. Many companies now need to comply with the Streamlined Energy and Carbon Reporting (SECR), so make sure you meet these BEIS requirements in your financial statements where relevant. TCFD will become mandatory for premium listed companies by the end of 2021 and all other companies in the coming years.

There are also clear marketing and PR benefits. According to the US Center for Sustainable Business, sales of consumer products marketed as sustainable grew more than seven times faster between 2015 and 2019 than products with no sustainability initiatives attached. 

Now is the time to start ‘Reducing – Avoiding – Eliminating’ and shift your organisation’s culture to something more sustainable that aims for a greener future.

Follow ICAEW's journey at our dedicated carbon Neutral hub ICAEW's journey to carbon neutrality | ICAEW