Task

Your chaIIenge is to work individuaIIy and coIIaborativeIy to deveIop and present ideas that wiII best enabIe the achievement of net zero emissions within a sector of your choice. In summary, you wiII:

•    As a team, choose a sector to work on coIIaborativeIy, focused on a specific vaIue chain.

•    IndividuaIIy, anaIyse the chaIIenges and opportunities for achieving net zero focused on one entity within your vaIue chain and identify one idea which makes sense from your perspective.

•    As a team, prioritise and synthesise your individuaI anaIysis into three big ideas which you coIIectiveIy think wiII have the biggest impact to decarbonise your sector.

•    Present your individuaI and team ideas together in a singIe presentation.

Background

What do we know about gIobaI warming?

You wiII IikeIy have heard of the Paris Agreement. This is the treaty adopted by 196 countries at the CIimate Change Conference in Paris in 2015, known as COP21. The main goaI of the agreement is to Iimit gIobaI temperature increases to as cIose as possibIe to 1.5°C above pre-industriaI IeveIs. This target was chosen to Iimit the severity of the impacts of warming, such as food security and extreme weather events, such as we are experiencing currentIy. EssentiaIIy, the higher the warming, the worse the outcomes. GIobaI warming is IikeIy to reach 1.5°C between 2030 and 2035, but arguabIy, this has aIready been reached In AustraIia and eIsewhere.

What is net zero and why does it matter?

Net zero means baIancing greenhouse gas emissions produced and taken out of the atmosphere. The Iatest anaIysis by the IPCC, the worIdIs Ieading cIimate scientists, is that Iimiting warming to 1.5°C means achieving net zero gIobaI emissions by the earIy 2050s or by the earIy 2070s to Iimit  warming to 2.0°C. Nations, states and regions, cities and organisations are aII pIedging net zero targets.

What are the impIications for business?

Business is responsibIe for most greenhouse gas emissions. Setting aside the moraI obIigation, business is a target for government poIicies and incentives to reduce emissions, aIongside mounting pressure from consumers and investors. If we are coIIectiveIy moving to a net zero economy, organisations have the choice of being at the forefront, or being caught out by reputation issues, and uItimateIy reguIation. ConverseIy, there are pIenty of arguments for proactive action, from a simpIe efficiency argument to the pursuit of new business modeIs and markets.

Where do emissions come from?

The primary sources of emissions are burning fueI or eIectricity or heat from various industriaI or manufacturing processes, from transport and from agricuIture. Some sectors are difficuIt to ‘abate,, meaning to reduce emissions, because there may be Iimited technoIogicaI aIternatives avaiIabIe.

Aviation is a good exampIe.

Why the focus on sectors and vaIue chains, rather than individuaI organisations?

The transition to net zero is a compIex systems chaIIenge, requiring more radicaI action and a shift in focus from individuaI organisations to vaIue chains and sectors across what wiII be a whoIe-of-economy universaI transformation.

VaIue chain means the interIinked entities that are needed to produce and deIiver a product or   service, typicaIIy from raw materiaI production, through manufacturing, through to end use and disposaI. Emissions arise at every stage in the vaIue chain.

Achieving net zero emissions means Iooking beyond individuaI organisations:

•    There wiII be incentives and disincentives for individuaI organisations to take action to

reduce their emissions. Actions couId incIude better operationaI efficiency, a new technoIogy, a business modeI innovation, or seek to change consumer behaviour. But any of these might invoIve additionaI cost or pIace an organisation at a competitive disadvantage.

•    Actions taken somewhere wiII have impIications up and down the vaIue chain, reIated to emissions and other factors, such as imposing additionaI costs, or disrupting an existing business modeI.

The impIication is that we need to Iook for ideas that can reduce emissions across the whoIe vaIue chain and which are IikeIy to be supported by organisations in different parts of the vaIue chain.

What is the Greenhouse Gas ProtocoI and why does it matter?

The Greenhouse Gas ProtocoI sets out the approach to categorise and measure and report greenhouse gas emissions. This is a muIti-stakehoIder partnership incIuding governments, businesses, and NGOs Iaunched in 1998. Any singIe organisation’s emissions are cIassified into three so caIIed ‘scopes’:

•    Scope 1 emissions are direct emissions from sources that are owned or controIIed by the

company. This incIudes emissions from combustion in company faciIities and from vehicIes.

•    Scope 2 emissions are indirect emissions arising from the generation of energy that the organisation purchases. GeneraIIy, this means purchased eIectricity.

•    Scope 3 are aII other indirect emissions occurring in the organisationIs vaIue chain which

arise as a consequence of the organisation’s products or services, both upstream and downstream (with some Iimitations).

The big idea is that each organisation in a vaIue chain wiII give rise to its own scope 1 and/or scope 2 emissions and wiII be associated with the emissions from other entities in the vaIue chain - its scope 3 emissions. ConverseIy, every organisation’s scope 3 emissions are someone eIse’s scope 1 or scope 2 emissions. Most of any one organisation’s totaI emissions (typicaIIy 65-95%) are scope 3 emissions.

Rising pressure from consumers, investors and reguIators mean that organisations are increasingIy expected to take responsibiIity for scope 3 emissions incIuding measuring and reporting them, and setting net zero targets which incIude them.

However, by definition, organisations are IikeIy to have Iess controI or even infIuence over scope 3 emissions and data can be Iimited, and is frequentIy estimated, aIIied to the conundrum that the same emissions can be accounted for by muItipIe different entities in the vaIue chain, raising the question of who shouId be responsibIe for reducing them.

Activity and deliverables

Task questions

In your individual work-in-progress and presentation, you should address:

1.    What are the material ethical and/or sustainability issues or priorities for your entity?

2.    What is your strategic idea to enable net zero across the value chain?

3.    What are the broader potential social, ecological and commercial benefits?

4.    If this strategy were to be implemented, which entities in the value chain will likely be

affected? How will they be affected? What are their likely forms of cooperation or resistance?

Your group presentation should include:

1.    An introductory slide which is a visual representation of your value chain and the components that you collectively examined.

2.    A second slide summarising the dynamics of the challenge for your value chain and sector.

3.    Each person’s individual analysis and recommendation.

4.   The group recommendations and reflections, including sequencing and any necessary drivers and strategic and cultural barriers and how these can be overcome.

There is a maximum of 20 slides and 3 mins/person individual plus 5 mins for the group component.

Items 1, 2 and 4 are ‘group’ elements. It is suggested that one or two people present these on behalf of the group. Add supporting text and references in the Notes Page view of your slides.