Humanity is doing too little, too late, when it comes to mitigating climate change. This was emphatically highlighted by UNEP, which, in its report Limiting Overshoot – Navigating Exceedance of 1.5°C and Pathways Towards Return, confirmed the impossibility of achieving the target, set out in the Paris Agreement, of limiting the rise in temperatures to 1.5°C above pre-industrial levels.
There are several analyses confirming these assessments. Many of them also concern Europe, the continent by far the most politically attentive and committed to decarbonisation efforts.
Italy is no exception, as highlighted by the KPMG report Sustainability Reporting: Survey on the Second Year of CSRD Implementation in Italy, which analyses the sustainability reports of 160 Italian companies falling within the scope of the CSRD. Of these, only 39 present a decarbonisation plan consistent with the requirements of the European Climate Reporting Standard (ESRS E1), and even fewer claim to have Net Zero targets.
These figures show that, today, being subject to the CSRD requires embarking on a gradual path towards sustainability: many businesses are still working on reliable calculations of their Scope 1, Scope 2 and Scope 3 emissions – a process which is, in itself, lengthy and costly. This is a prerequisite for decarbonisation: without establishing a robust emissions inventory, any mitigation efforts are likely to be in vain. Drawing up a decarbonisation plan is an even more demanding task: it spans a timeframe of at least 20 years, requires specific actions (including the annual recalculation of emissions), and has a significant impact on industrial development strategies, both in terms of process optimisation and the eco-design of products sold, and so on. Consequently, the delay in defining decarbonisation pathways stems both from the priority of correctly calculating the emissions inventory and from the complexity of compiling it.
Many references exist for defining decarbonisation plans. One is the aforementioned ESRS E1, also applicable to companies not subject to the European CSRD directive on ESG reporting. The best known is the Science Based Targets initiative (SBTi), an international initiative that supports businesses in setting greenhouse gas emission reduction targets consistent with the scientific evidence on climate change and the objectives of the Paris Agreement.
This context also includes the draft of an ISO standard from the 14060 series, entitled Net zero aligned organisations. The draft outlines the characteristics that an effective decarbonisation plan aimed at achieving Net Zero should possess. In particular, the plan must be urgent, calling for actions that the organisation is able to implement rapidly; it must be characterised by high ambition, with a tangible and consistent commitment to the stated objective; it must support the ecological transition by avoiding “business as usual” approaches and be based on a science-based approach. Moreover, it must adopt conservative criteria when defining assumptions and estimates, ensure that achieving the objectives does not generate new negative impacts, be credible and verifiable, incorporate the principles of Just Transition, ensure transparency through the publication of relevant information, and adopt a life-cycle approach.
The ISO draft reiterates that, on the path to Net Zero, priority must be given to actions that tangibly reduce CO2 emissions at all levels: the supply chain, processes, product eco-design, and so on.
The proposal, however, also recognises the role of offsetting, limiting it solely to hard-to-abate emissions, i.e., those for which there are currently no economically and technologically viable technical solutions for direct reduction. In such cases, CO₂ removal activities, whether nature-based or based on innovative technologies, must meet specific criteria: they must be durable, ensuring carbon storage for at least one hundred years and providing for the management of reversibility risks; they must be additional, proving that the removal would not have occurred without the implementation of a specific project; and, finally, they must be quantified using scientific methodologies. It is also necessary to ensure that such measures do not result in additional emissions elsewhere, thereby avoiding the transfer of environmental impacts.
As we have seen, businesses have no shortage of guidance on how to draw up plans to reduce greenhouse gas emissions. What is lacking is a sense of urgency regarding these measures, which, as usual, is postponed (and limited) until the next heatwave.
Cover: image by Envato