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Corporate commitments to net zero are at an all-time high. Who’s following through?

Achieving net zero goals in the coming decade will depend on the successful implementation of climate commitments.

More than one-third of the world’s largest publicly traded companies now have net-zero targets, including two-thirds of Canada’s largest businesses. These companies are the ones who can already see the future—and it’s low-carbon. But which companies are making real moves to turn these corporate pledges into reality?

Quite a few companies, clearly, are not. A recent United Nations expert panel found that many companies haven’t voluntarily begun the hard work of actually reducing their emissions.

Making meaningful progress is hard, and only happens when companies invest in lasting changes to their business models that decouple reliance on fossil fuels and carbon emissions from growth. What does this look like in practice?

Take Loblaws for example. They have committed to achieving net zero by 2030 for their truck fleet and net zero by 2040 for their stores, franchises, and corporate offices. Since then, they’ve made steady progress investing in areas to future-proof their business while also reducing emissions. Initiatives include the rollout of their first battery electric transport trucks in Quebec, as well as a first-of-kind purchase of renewable electricity in Alberta for their supermarkets, drugstores, offices and distribution centers which aims to reduce their nationwide operating emissions by 17 per cent. They completed over 250 projects last year in pursuit of their climate targets, which have led to reducing their emissions by 8 per cent from their 2020 baseline levels so far with an interim target of 50 per cent of 2020 levels by 2030.

Furthermore, Loblaws indicated last year that they would be looking at including their Scope 3 emissions as part of their net zero commitment by 2050. (Scope 3 emissions are those produced indirectly, such as travel, or emissions from supply chains — with only a third of Canadian companies are looking at their Scope 3 emissions). This will mean reducing emissions all along their supply chains, and would make Loblaws the first major grocery chain in Canada to be addressing their indirect supply chain emissions. While they indicated that more details will come next year, so far their efforts to address their supply chain emissions have resulted in changes in procurement practices for lower-carbon alternatives, engagement with the Canadian Alliance for Net-Zero Agriculture, and reducing food waste by diverting it from landfills.

Industry associations are another place to look. The Cement Association of Canada, for example, has made serious commitments in their net zero plan. The Association was able to gather the support of Canada’s largest cement producers and publish their action plan outlining a series of short- and long-term steps for the industry to reach net zero. This is no small feat given the sector is one of the most difficult to decarbonize in Canada.

The sector has identified five areas of opportunities and actions where emissions reductions can be achieved. These will include a range of approaches, new technologies and collaborations between the public and private sector. Innovative projects like Lafarge’s carbon capture and storage partnership with clean tech companies Svante and Dimensional Energy, which is set to convert carbon dioxide into marketable synthetic waxes, will become more common.

Does this mean that these plans and actions are perfect? Absolutely not. There is a long road to travel to get private sector actors on viable net zero pathways, and there will be bumps along the way. More support is also on the horizon with the green and transition finance taxonomy being developed by Sustainable Finance Action Council which will help provide clarity as to the types of investments beneficial to a low-carbon transition. But we would be missing the bigger picture if we didn’t acknowledge the incredible transformation that is taking place right now across business sectors both here in Canada and around the world.

Critical to achieving net zero goals in the coming decade will depend on the successful implementation of seizing opportunities and deploying climate solutions. This means that the spotlight should focus on whether they are addressing their entire supply chain of emissions, and how they plan on achieving the targets they set for themselves.