The Necessity of Global Net Zero: Why It’s More Relevant Than Ever
Addressing the rise in carbon emissions requires immediate, collective action, and businesses have a critical role to play in this global challenge.
In the first installment of our Introduction to Carbon Contribution series, we outline the need for strategies focused on carbon reduction, avoidance, and removal and how they form the backbone of responsible business practices in today’s changing climate.
In 2022, a discouraging figure emerged, revealing that global carbon dioxide (CO2) emissions had risen to a staggering 36.8 gigatons — a nearly 1% increase from the previous year. The effects were felt across the globe, as Europe sweltered through its hottest summer on record, and the rest of the planet wasn’t far behind, experiencing its third-warmest summer. As these upward temperature trends cement our new reality, they underscore the growing urgency for collective climate action. These statistics, more than mere data points, signal a pressing call to action for global business leaders.
Acting not only to reduce and avoid carbon emissions but also to remove them from the atmosphere is now non-negotiable. This necessity is echoed by the Intergovernmental Panel on Climate Change (IPCC), which states that carbon removal is essential to limiting warming to 1.5 degrees Celsius. The IPCC’s directive is not an option; it’s imperative to steer the longevity and sustainability of our planet.
In this article, we’ll delve deeper into the rationale and science behind why a three-pronged strategy — avoiding, reducing, and removing carbon emissions — is both beneficial and essential for businesses to move forward.
Tipping Point: Ecosystems Under Threat
The undeniable consequences of unchecked carbon emissions are increasingly evident in our daily lives. These repercussions manifest in environmental changes and profoundly affect the foundations upon which businesses operate.
First, consider biodiversity. A troubling study by the University of Washington and Princeton University suggests that if we do not significantly curb greenhouse gas (GHG) emissions, marine life could plummet to prehistoric levels in just a few centuries. The main causes? Rising ocean temperatures and declining oxygen levels due to climate change. However, the ripple effect does not stop there; species from the depths of tropical forests to the icy expanses of the Arctic are also at risk.
The consequences extend beyond the natural world as well, and the human cost is harrowing. In sub-Saharan Africa, studies by the University of Leeds project that unchecked carbon emissions could double heat-related child deaths by 2050. Additionally, the potential 1.2 billion climate refugees by mid-century could also foundationally disrupt global markets, essential services, and government stability.
Other events, such as rising sea levels, diminishing freshwater supplies, and extreme weather, are also becoming serious threats around the world. For businesses, this means unpredictable market shifts and vulnerable supply chains. For humanity, it means endangered health, safety, and well-being.
The Economic Case for Action
However, it’s also important to consider the economic implications beyond the immediate environmental need. In today’s business world, addressing climate change is a pressing economic issue.
The vulnerability of infrastructure is a prime example. With long lifetimes and significant up-front costs, many structures are vulnerable to extreme weather events due to design or siting errors. In the energy sector, particularly in Europe, variable weather disrupts demand and poses challenges for renewable energy. Agriculture also faces a mix of outcomes: while northern regions may see some benefits, areas such as southern Europe can expect difficulties.
Forestry, a vital component of many economies, faces increased risks from pests and fires. At the same time, the insurance industry, facing the brunt of more frequent extreme events, is recalibrating its approach to risk. Even the tourism sector, a mainstay for many regions, is shifting, with some traditional hotspots, such as Southern Europe, facing changing visitor dynamics.
Acknowledging these risks is therefore necessary for businesses that want to avoid potential property damage and supply chain issues. Yet, with these challenges also come opportunities: a changing climate spurs innovation, pushing companies toward adaptive, carbon-neutral solutions.
The Potential of Carbon Credits for a Sustainable Future
Addressing the consequences of climate change requires more than decisive action and investment; it requires thoughtful and comprehensive strategies focused on carbon reduction, avoidance, and removal. While global research underscores the importance of mitigation, the limitations of these efforts highlight the growing importance of the voluntary carbon market and carbon credits in financing and facilitating the removal of carbon from the atmosphere.
Today, transparent and continuous carbon accounting is essential for companies striving to achieve net-zero emissions. For industries such as cement, where inherent carbon-emitting processes such as calcination occur, reductions are incredibly challenging. Recognizing this challenge, entities like the Voluntary Carbon Markets Integrity Initiative (VCMI) are rating companies on their offsetting efforts, and there’s a growing consensus — supported by groups such as the Science Based Targets Initiative (SBTi) — that at least 10% of emissions will need to be actively removed beyond reduction and avoidance. Given this reality, the need for immediate action through carbon removal initiatives cannot be underestimated.
However, the emerging focus on voluntary carbon credits goes beyond emissions — it’s also about structural and holistic sustainability. Carbon credit projects like nature-based solutions often align with multiple UN Sustainable Development Goals (SDGs). They provide numerous benefits, from improving community well-being and water quality to addressing socioeconomic inequalities. Additionally, these initiatives can promote soil health, water conservation, and the upward mobility of local populations.
From a scientific perspective, nature-based carbon initiatives serve a dual purpose: they reduce greenhouse gas emissions while supporting local ecosystems. Efforts, particularly those like reforestation, emphasize the relationship between the climate and biodiversity.
Moreover, on the economic front, the value of carbon credits is rapidly increasing. Projections indicate that the market could expand significantly by 2050, depending on regulatory and market developments. As a result, overlooking this emerging sector can lead to not only reputational risks but also financial setbacks.
The promise of carbon credits in achieving a carbon-neutral future is undeniable. But along with the potential come complex market challenges, which we will touch upon later in our series.
Embracing the Net Zero Challenge: A Roadmap
The environmental and economic imperatives we’ve discussed underscore the need for immediate and robust action on carbon emissions. But recognizing the need is only the starting point. What does it mean for businesses, especially those with significant resources and influence? Their role goes beyond economic impact; businesses are uniquely positioned to champion environmental stewardship and lead the way to a more sustainable future.
However, the path to net zero can seem filled with complexity, so where does one start?
That’s why we’re launching this introductory series. This first article marks the beginning of a journey we’re taking together — a roadmap designed to demystify the process and guide you and your organization through the intricate steps of carbon contribution. Our goal is to break down the basics, highlight practical strategies, and spotlight the cutting-edge technologies that can facilitate this critical transition.
Making an impact is about making informed decisions backed by actionable plans and an unwavering commitment to change–and this series is here to guide you. We invite you to join us as we explore this pressing and evolving topic. The necessary journey to net zero begins now — we are glad to have you with us!
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