The UK is one of more than 50 countries that have set targets of net-zero greenhouse gases by 2050. More and more firms throughout the world are prioritising sustainability and green choices in their business models. Here we take a look at the pioneers leading the way and why it matters.
What is net zero and why is it important?
In 2019, the UK became the first major economy in the world to pass laws to end its contribution to global warming by 2050.
In its Net Zero report to Government, the UK Climate Change Committee acknowledged that the effects of climate change are already being felt — more frequent heatwaves, greater damage to sensitive ecosystems and irreversible changes in animal behaviour.
However, by reducing global emissions, we can keep global warming at a lower level and limit the most damaging effects of climate change.
Reaching ‘absolute zero’ greenhouse gas emissions is probably impossible. Reaching ‘net zero’ emissions means removing an equal amount of CO2 from the atmosphere as we release into it. In other words, ensuring that global greenhouse gas emissions from human activity are balanced by emissions reductions.
Why is net zero relevant to business?
According to the World Resources Institute (WRI), the world emits around 50 billion tonnes of greenhouse gases each year, over two-thirds of which relate to the energy sector (electricity and heat, buildings, manufacturing and construction, transportation, etc.).
The only way to reduce and offset those emissions is to target businesses — both small and large — which are ultimately responsible for energy use, manufacturing, processing, building, construction, travel, logistics, retail, agriculture and other activities causing those emissions.
Businesses and business leaders therefore have a crucial role to play in supporting climate change action. One report estimated that 100 companies — including ExxonMobil, Shell, BP and Chevron — were responsible for 70 per cent of the world’s greenhouse gas emissions.
Which businesses are leading the way?
Burberry (UK)
The fashion industry uses vast amounts of water and energy, and creates huge waste, particularly when clothes end up in landfill. Burberry has pledged to become carbon neutral — and ultimately carbon positive — by 2040, removing more carbon from the atmosphere than it emits.
In 2020, it became the first luxury brand to issue a sustainability bond, financing sustainability projects including greener buildings and sustainable sourcing. It also secured a £300m Sustainability Linked Loan to support its net zero target.
Nestlé Nespresso (Switzerland)
For coffee-producing regions, unpredictable weather caused by climate change can significantly affect yield and quality. Nespresso signed up to the Intergovernmental Panel on Climate Change’s target to reach net-zero greenhouse gas emissions before 2050.
The company has transformed operations through improved machine efficiency, renewable energy, adaptive farming practices and recycling programmes. In 2022, Nespresso received carbon neutral certification from The Carbon Trust and is working to halve emissions by 2030.
IKEA (Sweden)
IKEA is committed to becoming a climate positive business by 2030, reducing more greenhouse gas emissions than its value chain emits.
Its circular design principles mean products are created to be reused, refurbished, remanufactured and recycled. In 2021, 56 per cent of materials were renewable and 17 per cent recycled. More than 99 per cent of its wood is sustainably sourced, and its cotton complies with Better Cotton standards. IKEA Home Solar launched in 2015 and continues to expand globally.
Honda (Japan)
Honda focuses on eliminating environmental impact while enhancing safety. In 2012, it became the first mobility company to disclose greenhouse gas emissions across its entire value chain.
Its Triple Action to ZERO strategy focuses on carbon neutrality, clean energy and resource circulation. By 2040, all automobiles sold by Honda will be electric or fuel cell vehicles. By 2050, the company aims to achieve carbon neutrality across all products and corporate activities.
Why should I study the Global MBA?
Our Global MBA is designed to keep you up to date with social, economic and technological developments, helping you promote innovation and respond effectively to change.
At the University of Hull, our vision is for a ‘fairer, brighter, carbon neutral future’. A key priority is equipping you with the expertise and tools needed to be an impactful leader in a carbon neutral, digitally transformed world.
Sustainability themes are embedded throughout the Global MBA curriculum, including climate change and business decision-making, responsible leadership, corporate social responsibility and sustainable supply chain development.