Making the Leap: A Business’s Guide to Net Zero

UN SDGs
UN SDGs 7

Enterprises play a significant role in reducing emissions, and fortunately, more businesses recognize the advantages of a decarbonized economy. Data and analytics can help organizations speed up and scale their efforts to establish and adopt low-carbon practices across their business, most importantly in global supply chains.

Our collective carbon footprint swelled as the increasing global population demands goods, services, and energy. Over the past 30 years, annual global greenhouse gas (GHG) emissions increased by 50% due to the increased combustion of fossil fuels — in order to meet these demands.

Being a net-zero company means dramatically reducing GHG emissions. As of December 2020, regions with actual or intended “net zero by 2050” targets generated more than two-thirds of the global gross domestic product (GDP) and accounted for more than half of global emissions and population. On a global scale, the top five sources of emissions are electricity and heat (31%), transportation (15%), manufacturing (12%), agriculture (11%), and forestry (6%).

In fact, supply chains have the most room for improvement to meet sustainability goals. The average consumer-goods company’s supply chain incurs far higher social and environmental costs than its own operations. Furthermore, the impact from supply chain accounts for more than 80% of GHG emissions and more than 90% of the impact on air, land, water, biodiversity, and geological resources.

 

The UN Sustainable Development Goals (SDG)

The 17 Sustainable Development Goals (SDGs) set forth by the United Nations (UN) serve as a road map for achieving sustainable development for all. It aims to tackle issues like poverty, inequality, climate change, environmental degradation, peace, and justice, among other global problems we face today.

The SDGs are a set of targets and objectives that businesses can use as a guide in strategizing and evaluating their sustainability efforts. Involvement with the UN’s SDG framework was reported by 22.8% of Fortune 500 companies. However, only 0.2% of these businesses have created tools and methods to gauge how well they are doing in achieving the relevant SDGs.

We’ve compiled a list of key performance indicators (KPIs) that businesses can monitor in accordance with the UN’s SDGs. These KPIs were consolidated from various industry-recognized benchmarks, such as the GRI Standards, the UN’s Global Compact – Oxfam Poverty Footprint and Business Call to Action (BCtA) framework, the CDP, and World Bank. This list can help organizations track the effectiveness of their sustainability initiatives, particularly those aimed at reducing their carbon footprint.

 

Goal 3: Good Health and Well-Being

The objective of this goal is to guarantee healthy lives and promote well-being for all people regardless of age. One of its targets is to ensure that the air we breathe is clean enough for everyone. In fact, 60% of all global emissions are generated by supply chains, and approximately 4.2 million people died in 2016 because of ambient air pollution caused by traffic, power generation, waste burning, and residential fuel combustion.

 

KPIs Data Points Metrics to Calculate

 

 

 

 

 

 

 

Air quality

Scope 1 GHG emissions Number of people
Significant air emissions for nitrogen oxide (NOx), sulfur oxide (SOx), persistent organic pollutants (POP), volatile organic compounds (VOC), hazardous air pollutants (HAP), particulate matter (PM), and other air emissions Metric tons (MT) of carbon dioxide (CO2) equivalent MT of CO2 and trichlorofluoromethane (CFC-11) equivalents
Emissions of methane (CH4), nitrous oxide (N2O), hydrofluorocarbons (HFCs), perfluorochemicals (PFCs), sulfur hexafluoride (SF6), nitrogen trifluoride (NF3), or all; biogenic
CO2 emissions; production, import, and exports of ozone-depleting substances (ODS)
Tons of gas or pollutant
Methane emissions (including energy-related)

Kiloton (kt) of CO2 equivalent (CO2e) and percentage change from 1990; percentage of total methane emissions

 

Goal 7: Affordable and Clean Energy

This goal aims to ensure that everybody has access to affordable, reliable, sustainable, and modern energy. In contrast to nuclear energy and fossil fuels (e.g., coal, oil, natural gas), renewable energy sources produce clean, safe, and dependable electricity with little to no carbon emissions. 

 
KPIs Data Points Metrics to Calculate

 

 

Emissions

Scope 2 emissions by country or region where the company or its business unit operates MT of CO2e; MWh
Reduction of emissions through sustainability initiatives MT of CO2e

 

 

Goal 12: Responsible Consumption and Production

Sustainable consumption is the use of material goods, energy, and immaterial services in a way that minimizes their negative effects on the environment. In the food industry, for instance, an estimated 30% of the food produced for human consumption worldwide is lost or wasted somewhere along the food supply chain. After China and the United States, the world's third-largest emitter of greenhouse gases is food loss and waste, which accounts for approximately 4.4 gigatons of greenhouse gas emissions (CO2 equivalent) annually.

By 2050, it’s anticipated that there will be 9.1 billion people living on the planet, which will increase food availability by 70%. Therefore, it’s important for businesses to be conscious of their production and consumption activities by streamlining their procedures to minimize food waste.

 
KPIs Data Points Metrics to Calculate
GHG emissions Scope 1 and Scope 2 emissions MT of CO2e
ODS emissions Emissions of CH4, N2O, HFCs, PFCs, SF6, NF3, or all; biogenic CO2 emissions; production, import, and export of ODS MT of CO2 and CFC-11 equivalents

 

 

Goal 13: Climate Action

Globally, business-related GHG emissions could be reduced by 3.7 billion tons of CO2e annually by 2030. In addition, emissions from the freight and transportation sector in the US include more than 50% of all nitrous oxide emissions, more than 30% of volatile organic compound emissions, and more than 20% of particulate matter emissions.

KPIs Data Points Metrics to Calculate

 

 

Energy targets

Products and services with low carbon footprint and enables others to avoid or reduce emissions Percentage of revenue and research and development (R&D)
Reductions in emissions set by the company MT of CO2e; currency
Expenses Expenses in environmental protection (e.g., waste disposal, emissions treatment) Currency

 

Goal 14: Life Below Water

This goal’s objective is to encourage everyone to conserve and sustainably use the oceans, seas, and marine resources. Human-related carbon emissions are responsible for ocean warming, acidification, and oxygen depletion. Approximately 80% of goods traded internationally are transported by sea, and this percentage is even higher for the majority of developing nations.

KPIs
  Data Points
Metrics to Calculate
Pollution
Significant air emissions for NOx, SOx, POP, VOC, HAP, PM, and other air emissions
Kilograms (kg) or multiples
 

Goal 15: Life on Land

This goal encourages all to sustainably manage forests, combat desertification, halt and reverse land degradation and biodiversity loss, whether through regulatory compliance, initiatives spurred by economic incentives, and establishment of company policies.

 

KPIs
  Data Points
Metrics to Calculate
GHG emissions
Scope 1, Scope 2, and Scope 3 emissions; emissions of CH4, N2O, HFCs, PFCs, SF6, NF3, or all; biogenic CO2 emissions; production, import, and export of ODS
MT of CO2e
 

Integrating data and analytics into sustainability strategies

Companies need the right tools and technologies to fully grasp their environmental impact and implement the most sustainable business practices. The necessity for well-integrated business intelligence platforms increases as environmental, social, and governance (ESG) issues become more significant in business strategies.

Analytics plays a crucial role in helping businesses develop sustainability strategies. It can monitor how well they are doing in achieving the relevant SDGs by filtering and analyzing data, sorting through unconventional and unstructured information, and integrating them into valuable insights.

Download our white paper to learn more about the SDGs and the essential KPIs that organizations can establish, as well as the data points that can be tracked, metrics to calculate, and how they contribute to the KPIs.

Tracking and Measuring Sustainability Targets and KPIs

Download our white paper