Full Title: Corporate Low-Carbon Transition Planning: Best Practices & Recommendations to Support Credible Action
Author(s): Nicholas Franco and Naila Karamally
Publisher(s): Center for Climate and Energy Solutions (C2ES)
Publication Date: July 1, 2024
Full Text: Download Resource
Description (excerpt):
Thousands of companies have set ambitious, interim 2030 carbon reduction goals and pledged net-zero emissions by 2050. Yet, some stakeholders are skeptical, suggesting corporate net-zero goals are no more than greenwashing. The United Nations High Level Expert Group (HLEG) report Integrity Matters: Net Zero Commitments by Businesses, Financial Institutions, Cities and Regions emphasized that net zero commitments should deliver significant near- and medium-term emissions reductions, which are based on an implementation plan that is: science-based, transparent, verifiable, and that aligns actions and investments with net-zero commitments.
With this project and the accompanying report, the Center for Climate and Energy Solutions (C2ES) aims to support and accelerate the development of low-carbon transition plans that align with the objectives of the Paris Agreement among companies in real-economy industry sectors. To this end, it is important to understand: (1) the existing guidance landscape for target setting, planning, and credibility, as well as broader stakeholder requirements for transition planning; and (2) the current state of corporate transition planning.
This work began with an analysis of transition planning guidance focused on real-economy companies from nongovernmental organizations (NGOs), governments, and quasi-governmental organizations that focused on identifying commonalities and unique requirements. Guidance from the Task Force on Climate-Related Financial Disclosure (TCFD) and the Glasgow Financial Alliance for Net Zero (GFANZ) were both the most comprehensive and the most widely adopted of all the guidance reviewed. There is a high level of correspondence between TCFD and GFANZ and other transition planning guidance, though there are some differences. Areas of divergence arise when a particular guidance provides more in depth or specific requirements around certain topics. For example, the UK Transition Planning Task Force (TPT) guidance recommends companies disclose their intended use of carbon credits and update these disclosures annually. Guidance also varies with regard to just transition and nature-based impacts, with GFANZ and Ceres both including these thematic considerations.