Sustainability in Business: Why Companies are Focusing on Reducing their Carbon Footprint

Climate change is one of the most pressing challenges of our time, and businesses have a crucial role to play in mitigating its effects. According to the Intergovernmental Panel on Climate Change (IPCC), human activities have caused global warming of about 1.1°C above pre-industrial levels, and this is likely to reach 1.5°C between 2030 and 2052 if it continues at the current rate. The consequences of this warming are already evident in the form of more frequent and intense extreme weather events, sea level rise, biodiversity loss, and food insecurity.

To avoid the worst impacts of climate change, the IPCC recommends that global net human-caused emissions of carbon dioxide (CO2) be reduced by about 45% from 2010 levels by 2030, reaching net zero around 2050. This means that any remaining emissions would need to be balanced by removing CO2 from the air. Achieving this goal requires unprecedented transitions in all aspects of society, including energy, industry, transport, buildings, and land use.

Many companies are aware of the urgency and the opportunity of addressing climate change, and are taking action to reduce their carbon footprint. A carbon footprint is the amount of greenhouse gases (GHGs) that are emitted by an entity or an activity, expressed as CO2 equivalent. By measuring and reporting their carbon footprint, companies can identify the sources and magnitude of their emissions, set targets for reduction, and monitor their progress. Reducing carbon footprint can also bring multiple benefits for businesses, such as:

- Cost savings: By implementing energy efficiency measures, switching to renewable energy sources, and optimizing logistics and supply chains, companies can lower their operational costs and improve their profitability.

- Competitive advantage: By demonstrating their commitment to sustainability, companies can enhance their reputation and brand value, attract and retain customers and employees, and gain access to new markets and opportunities.

- Innovation: By adopting low-carbon technologies and practices, companies can foster innovation and creativity, develop new products and services, and increase their productivity and quality.

- Risk management: By anticipating and responding to the physical and regulatory risks associated with climate change, companies can reduce their exposure to disruptions, fines, lawsuits, and reputational damage.

Some examples of companies that are leading the way in reducing their carbon footprint are:t.

- Microsoft: The tech giant has pledged to become carbon negative by 2030, meaning that it will remove more carbon from the atmosphere than it emits. It also aims to remove all the carbon it has ever emitted since its founding in 1975 by 2050. To achieve these goals, Microsoft plans to invest $1 billion in a climate innovation fund, switch to 100% renewable energy by 2025, electrify its global campus operations vehicle fleet by 2030, and use carbon capture and storage technologies.

- IKEA: The Swedish furniture retailer has committed to becoming climate positive by 2030, meaning that it will reduce more GHG emissions than its value chain emits. It also aims to inspire and enable its customers to live more sustainably. To achieve these goals, IKEA plans to use 100% renewable energy across its operations by 2025, make its products from renewable or recycled materials by 2030, offer services such as furniture rental and repair, and support climate action projects around the world

- Unilever: The British-Dutch consumer goods company has set a target to achieve net zero emissions from all its products by 2039, from sourcing to point of sale. It also aims to empower its consumers to take climate action. To achieve these goals, Unilever plans to source 100% of its energy from renewables by 2030, eliminate fossil fuels from its cleaning products by 2030, halve its use of virgin plastic by 2025, and invest €1 billion in a climate and nature fund.