On this basis, the global community reached a consensus to:

• triple renewables and double energy efficiency, while transitioning away from fossil fuels.
• support climate innovation and encourage cross-border and inter-generational collaboration for sustainable social and economic development.

From pledge to action

With a trajectory and plan defined, we now need to fully tackle the crux of the issue, starting with the 70% of greenhouse gas (GHG) emissions, which are energy related.

From the way we source energy to the way we use it across buildings, grids, mobility, and industry, there is no time to waste in embracing every pathway to decarbonize, for the sake of planet, people and yes, the economy too.

55% emission saving potential based on existing solutions

Contrary to popular belief, decarbonization of demand accounts for more than half of global emissions reduction, to reach net-zero by 2050, with supply decarbonization accounting for the rest. On the demand side, efforts are focused on demand optimization (changing consumption patterns) and process changes (including electrification of the energy system). These transformations can result in significant carbon and energy savings, while also benefiting consumers.

For example, in buildings, technologies such as heating electrification and active energy efficiency solutions have the potential to lower carbon emissions by 2030, generating up to 70% carbon savings for building dwellers, and up to 30% energy savings with a return on investment within 3-5 years.

In the industrial sector, automation and digital tools can optimize processes, productivity, performance, and energy usage, resulting in a 20% reduction in electrical, instrument, and control capital expenditure and a 10% improvement in process energy usage.

Scaling the adoption of these existing solutions is crucial to achieve the goal of doubling the rate of energy efficiency by 2030.

Most of the global grid is unfit for renewables today

It is estimated that wind and solar photovoltaics (PV) will contribute over 80% of the global power capacity increase in the next two decades. To accommodate for this clean energy push, around 80 million kilometers of power lines need to be added or replaced by 2040, which is equal to the entire existing global grid.

Currently, there are approximately 3,000 GW of renewable power projects waiting in grid connection queues, with half in advanced stages. This backlog is five times the solar PV and wind capacity added in 2022, indicating that grids are hindering the transition.

To further the tripling of renewable energy, distribution grids must be modernized, and decentralized. Innovative funding models, like Energy-as-a-Service can help overcome the challenge of upfront capital investments and make energy resilience more accessible.

For example, AlphaStruxure’s Energy as a Service model, pioneered by Schneider Electric and the Carlyle Group, combined with EcoStruxure Microgrid solutions, helped Montgomery County become a leader in fleet electrification and a sustainability archetype for local governments across the United States — all with zero capital outlay.

The Brookville Smart Energy Bus Depot now boasts a 6.5 MW microgrid with on-site solar, battery energy storage, and natural gas generation. Moreover, Schneider Electric’s EcoStruxure solutions ensure that the buses can operate even during main grid outages, providing peace of mind for the County’s 1.1 million residents.

138 million new jobs to be created out of the energy transition

To seize this opportunity, we need to re-train and upskill people. This requires a deliberate effort to include public stakeholders, civil society groups, youth, and women to be part of the solution.

In addition, close to 2 billion people lack access to clean, reliable electricity. Equipping individuals and organizations with knowledge and tools for sustainable clean energy infrastructure has a positive multiplier effect across various socio-economic dimensions, including livelihood, health, education, security, and women’s empowerment.

As part of Schneider Electric’s sustainability impact goals, the company is aiming to connect 50 million people to clean and reliable energy by 2025, and 100 million people by 2030. As well as training 1 million people in energy management.

Since 2009, Schneider Electric has provided clean energy solutions to more than 40 million people, invested in 26 companies, trained 430,000 people, and supported more than 5,600 entrepreneurs with the help of 7,000 trainers globally. This progress would not have been possible without close partnerships with local public sector stakeholders and civil society groups.

Impact companies at the forefront

While there is momentum from the private sector to support climate action, only 8% of corporate leaders have the necessary digital tools to achieve their net-zero targets. Companies often underestimate the impact of electrification and enhanced automation in their sustainability plan.

Schneider Electric serves as an example of a company driving sustainability and reaping the benefits. It has consistently ranked at the top of worldwide ESG ratings for over a decade and was named the World’s Most Sustainable Corporation in 2021 by Corporate Knights. What is more is that Schneider Electric has seen its sustainability-led strategy contribute tripling its annual revenue from €9bn in 2003 to €34bn in 2022.

Not only are Schneider’s Net-Zero targets validated by the Science Based Targets initiative (SBTi), fully aligned with their Corporate Net-Zero Standard, but it has also implemented a comprehensive and measurable Environmental Social and Governance (ESG) plan that is monitored at the executive level and embraced at all operational levels, and showing concrete quarterly progress.

An example of how this translates is Schneider Electric’s flagship program Zero Carbon Project, which aims to halve supplier CO₂ emissions by 2025. The initiative provides capacity building, resources, and expert support to program participants, helping them set and achieve their carbon reduction targets while advancing decent work standards across the supply chain. To date the company has achieved almost 25% reduction, nearing the halfway target.

By aligning environmental, social, and business strategy, Schneider Electric intends to live up to Impact Company principles:

1. Do good to do well and do well to do good: Business and financial performance enable environmental and social impact. Sustainability is a source of performance and growth​.
2. Bring everyone along: Positive impact can only happen if you are not a lonely leader, if you foster a movement of global goals and local efforts to leave no one behind​.

Schneider Electric’s mission is to be the digital partner of sustainability and efficiency for homes, buildings, data centers, infrastructure, and industries, by combining energy technologies, real-time automation, software, and services.

Find out more about how to implement an energy and sustainability strategy here. For more information on acceleration pathways for corporates post-COP28, visit here.

The post Corporate climate action: 3 acceleration areas to get ahead on in 2024 appeared first on Corporate Knights.

This article is “sponsored content” as defined by Corporate Knights’ content disclosure policy.

As the number of severe weather events continues to rise across Canada and globally, it’s evident the fight against climate change is a constant threat to our world’s health, safety, and sustainability.

At the recent United Nations COP26 climate summit in Glasgow, diplomats from nearly 200 countries struck a major agreement to increase the fight against climate change — establishing a consensus that more must be done to protect the planet.

Canada is making strides to address climate change, pledging ambitious commitments to accelerate a path towards a safe and prosperous net-zero future by 2050. But achieving a net-zero future requires every sector of the economy play a role, not just government. Real, lasting, and impactful change that is enough to stop global temperatures from increasing requires collective action, spanning the public and private sectors, policy makers, and ordinary citizens. Collaboration is the best chance we have of creating a more sustainable, electrified world.

“[Climate change] is top of mind across most organizations today and something we must pay close attention to,” said Adrian Thomas, president of Schneider Electric Canada, in a recent leadership panel.  Joined by executives from HP Canada, BGIS and Ivanhoé Cambridge. These companies are working across sectors to bring businesses together in their ambitions to address climate change.

While Schneider Electric has continuously raised the bar on transitioning to a green, circular, low-carbon and profitable business model, there is a growing need for all business leaders to act and do more — and stakeholders, including employees, are demanding it.

A recent Willis Tower Watson survey shows that 81 percent of employees believe it’s important for organizations to integrate climate strategy in their employee-value proposition. The survey also shows a third of respondents believe executive compensation should be tied to delivery of climate strategy, while nearly half of employers expect their employees to play a role executing these actions.

The benefits of increasing sustainability are “exponential” and go beyond lowering emissions, Thomas says. “Reducing carbon, in almost all cases, means you’re also being more efficient with the resources that you’re using. So fundamentally, that’s helping your bottom line.”

It also attracts investors: An Edelman survey shows 95 percent of institutional investors believe a company with strong environmental, social and governance (ESG) performance deserves a premium valuation for its share price.

Here are three ways corporate leaders can step up their activities to fight climate change:

Effective goal setting 

Having a net-zero business model that is realistic, achievable, measurable, and science-based is critical for organizations to make meaningful change.

Thomas says organizations should start by measuring their current footprints, using well-established reporting metrics, and identifying the major emission sources. “From there, you can start to address where to make improvements and how to make the transition.”

To remain accountable, he says organizations also need to be transparent with their goals by making the results public and updating them regularly.

“Transparency adds weight,” he says. “It’s about doing more than saying ‘we want to be a sustainable company,’ but really committing to those targets.”

It’s a journey Schneider Electric started about 15 years ago, with a commitment to take urgent action to co-create a brighter future aligned with the United Nations Sustainable Development Goals. The company publishes a sustainability report annually and makes it public.

“This is part of our company ethos; this is who we are, it’s part of our core values,” Thomas says. “It helps drive us to do more and to do better.”

Schneider Electric’s current targets include achieving carbon neutrality in its extended ecosystem by 2025 and setting net-zero operational emissions by 2030. It also plans to derive 80 percent of its revenue from green solutions by 2025, have 1,000 of its top suppliers reduce CO2 emissions by 50 percent by 2025 and have an entirely net-zero supply chain by 2050.

Reducing carbon, in almost all cases, means you’re also being more efficient with the resources that you’re using. So fundamentally, that’s helping your bottom line.

-Adrian Thomas

Be selective with suppliers

Tackling sustainability beyond an organization’s own operations – across the supply chain – is the next big challenge.

According to the Carbon Disclosure Project (CDP) supply chain emissions are more than 11 times higher on average than operational emissions — and can be even larger in industry segments like retail, apparel and services. The CDP also warns that organizations are facing up to US$120 billion in costs from environmental risks in their supply chains by 2025.

Supply chain engagement is critical for companies to reduce climate and operational risk, Thomas says, adding that Schneider Electric does this with its suppliers.

“It’s a very supportive circle of work that includes some of our suppliers and our customers that are on the same journey,” he says, adding that Schneider Electric also shares its technology solutions that can help organizations achieve decarbonization targets. “The whole digitalization journey goes hand-in-hand with decarbonization: they support each other.”

Engaging with suppliers also helps to set expectations and drive broader improvements across industry, Thomas adds.

“It’s a connected chain. If we’re going to reduce emissions across the supply chain, we must make it clear what the requirements are to our suppliers,” he says. “By having a dialogue with suppliers and setting expectations, you will see different companies start to adapt and bring on sustainability practices that will help them continue to thrive in a market that’s really demanding it.”

Frances Edmonds, HP Canada’s Head of Sustainability reinforced Thomas’ point, noting the tensions which can arise in supply chain relationships. For example, when a firm has targets set on more ambitious timelines than their suppliers, or when a company’s purchasing power is diluted down the supply chain (i.e., with firms they don’t buy from directly). Both Edmonds and Thomas emphasized the importance of taking a collaborative approach to overcoming these challenges.

Edmonds also listed urgency and improved reporting metrics as pillars to focus on when making supply chains more sustainable. Thomas added the importance of communicating targets with employees, who make decisions every day that affect both sustainability and the bottom line.

Tie executive compensation to ESG performance  

It’s not enough for organizations to set and chip away at sustainability targets. Key stakeholders such as employees and shareholders are looking to hold business leaders accountable to steer their companies towards achieving their ESG goals.

Research finds 58 percent of Canadian institutional investors said that linking executive compensation to ESG target performance “greatly impacts” their trust in a company.  The Willis Watson survey also shows 43 percent of employers have implemented, started to implement, or are considering climate metrics for their executive incentive plans, while another 27 percent may consider these in the future.

Moving the needle on climate change requires innovative approaches in every corporate boardroom, Thomas says.

Schneider Electric, for example, ties executive compensation to ESG performance and makes the results public. It’s both an incentive and a reward he believes helps organizations move forward more aggressively on decarbonization and other sustainability goals.

“What we have in our sustainability targets lines up with what the executives have in their targets and then that modulates a portion of that cash bonus piece,” he says.

It’s time to lead

The onus is on business leaders to acknowledge the business imperative for addressing the climate crisis head-on.

“We need to get everyone on board with awareness of this critical issue,” Thomas says.

He says decision-makers have a responsibility to lead their companies in the fight against climate change to create truly sustainable organizations that will have a global and societal impact now, and for the future.

The post The zero-carbon business leader takes shape appeared first on Corporate Knights.

We’ll also need more of them: Consider that a typical electric vehicle requires six times more minerals than those with a conventional internal combustion engine, while an offshore wind farm requires 13 times the amount of mined minerals versus the equivalent amount of power generation from the natural gas-fired power station.

It’s paradoxical, given that mining is an extractive industry that is responsible for about 4 to 7 percent of the world’s global gas emissions. Since there is no substitute for these essential commodities, the mining industry will need to decarbonize to become a welcome part of the low-carbon future, says David Willick, vice-president and regional leader of mining, metals and minerals in North America for Schneider Electric.

Willick argues the time to act is now given growing awareness of the negative impacts of climate change and the opportunities for change.

“The carbon-free movement is being driven by a convergence of investor interest, public and customer concern over global warming, regulatory actions and technological innovation,” says Willick, whose team helps mining operations extract metals and minerals in the most sustainable way.

The mining industry understands the pressure: More than 27 per cent of mining and metals organizations identified the need to improve brand equity as a top driver for sustainability, compared to 18 per cent for the industry, according to a report from market intelligence company International Data Corporation (IDC), commissioned by Schneider Electric.

It underscores why so many miners are in the midst of a huge transformation — moving away from its traditional extraction methods toward a technology-driven future that’s more sustainable and supports the global transition to a low-carbon economy.

Climate-smart mining, minerals and metals practices are good for business

Given the market is demanding sustainability be a priority, a more sustainable operating model is helping mining companies build their businesses. Specifically, many can attract new business partners who are interested in being more sustainable across their supply chains.

Willick points to Anglo-Australian multinational miner Rio Tinto as a key example. The company has an agreement to provide coffee company Nespresso with responsibly sourced aluminum for its capsules. Rio Tinto and Alcoa — two of the world’s largest aluminum suppliers — also have an agreement through the joint-venture Elysis, to produce carbon-free aluminum for Apple to use in its products by 2024.

The ability to successfully drive sustainability through every part of the business will be critical for mining companies to thrive in the low-carbon economy.

Willick notes several forward-thinking companies have already taken a leadership role and established aggressive benchmarks for sustainability.

For instance, Rio Tinto has set ambitious emissions targets to reduce its carbon intensity by a further 30 per cent and its absolute emissions by a further 15 per cent by 2030, alongside establishing a $1 billion fund to invest in climate-related projects. These targets will bring the company closer to achieving its long-term goal of becoming net zero emissions by 2050 (which includes emissions from shipping its products).

Anglo American, meanwhile, has set a target of achieving carbon neutrality across its operations (Scopes 1 and 2) before 2040, while Canada’s Teck Resources Ltd. is aiming to be carbon neutral across all of its operations by 2050, disposing of zero industrial waste by 2040, and transitioning to the use of seawater or low-quality water for all operations in water-scarce regions by 2040.

The 28-member International Council on Mining and Metals (ICMM) also recently committed to a goal of net zero scope 1 and 2 greenhouse gas (GHG) emissions by 2050 or sooner, in line with the ambitions of the Paris Agreement.

Sustainability targets are no longer voluntary for companies that want to participate in the new, green economy, Willick adds.

“It’s essential to have a roadmap to decarbonization to move forward,” he says, which includes investing in technology to make it happen.

“For leading mining companies, these investments as part of the push towards sustainability isn’t just a reaction to market forces; it’s strategic.”
– David Willick, VP and regional leader of mining, metals and minerals for Schneider Electric

Technology to drive safety, lower costs and improve sustainability

Setting targets is important, but it takes investment in new emission-reduction technologies and systems to help companies get there.

The broad goal is sustainability, but these investments can also save companies money through lower energy costs and reduce risk by increasing safety across their operations. The result is greater value creation.

“If you lower your cost per ton by utilizing some of these technologies and sustainability methods, then you become more efficient,” Willick says.

Some of the technologies that miners are using include artificial intelligence and machine-learning for predictive maintenance, to the use of data and analytics to make process improvements.

More efficient companies are also better-positioned to weather the commodity cycles that are well known in the industry — and outperform their peers. “As commodity prices fluctuate, those that can produce the commodities with the lowest cost per tonne are always going to be in a good situation,” Willick notes.

The pandemic, particularly the urgency to adopt remote technology, has accelerated many companies’ plans to invest in innovation that drives sustainability. For example, Willick says Schneider Electric has seen a dramatic increase in customer engagement since the pandemic started around March 2020, many of which are looking to boost their investments in innovation and technology.

“Schneider Electric is really good at helping customers decarbonize through their entire supply chain, and we are taking that on,” he says, adding his company also has set aggressive targets to be carbon neutral by 2025 and net zero by 2030.

“Decarbonization and digitalization plans go hand-in-hand. Being more efficient requires more digitally connected devices and requires more insights into the data.”

For instance, he says companies are using sensors during the extraction phase to glean more information about each shovel bucket or scoop, which increases yield while reducing waste rock that would have been processed, which helps to conserve the use of water and reduce tailings waste.

Big data can also be used for real-time monitoring of people and machines on the mine site, to help improve productivity as well as increase safety and protect the environment.

“The more connected a company is, the more efficient and ready for the digital future,” Willick says.

The future of resource extraction and processing is smart, digital, and sustainable

Innovation is key to building a greener, more resilient future. Adopting sustainability as a business imperative pays positive environmental, social, and governance (ESG) impacts and provides long-term economic gain and competitive advantage.

The urgency for the mining industry to address its sustainability challenge has never been greater, Willick argues, given the growing backlash from its perceived stagnant positioning on ESG performance.

He says mining companies need to implement smart, digital tools that enable them to make informed decisions and empower people across the value chain to make strategic, sustainable choices. “For leading mining companies, these investments as part of the push towards sustainability isn’t just a reaction to market forces; it’s strategic,” Willick says. “It’s the early adopters that will benefit significantly over the long term.”

The post Why mining companies must prioritize the path to decarbonization appeared first on Corporate Knights.

The urgency to address climate change is ever growing. Businesses are under increasing pressure from investors, legislators, customers, and employees to accelerate their strategic vision and map out a plan of tangible actions. The good news is the technology and know-how exist today to help businesses on their journey to a zero-carbon future. Partnering with organizations that have experience with their own sustainability journey can reduce risk and uncertainty for those that are hesitant to adopt digital solutions. Early adopters of technology have learned that the path towards a zero-emission future requires you to set goals, announce your targets, deploy custom efficiency programs and adjust where necessary – it’s a non-linear and collaborative process that takes time, resources and people to get right. And while digital adoption remains one of the biggest barriers to action, Schneider Electric’s VP of Services, Frederick Morency, says there are four megatrends in commercial sectors that are gathering momentum and enabling businesses to begin their own journeys. The trends driving this action are energy flexibility, digitization, the electricity transition and most importantly, engagement and the human dimension. Together these trends are setting the stage for businesses to achieve their zero-emission goals.

Energy flexibility

“The need for action toward a low-carbon future is undeniable and we must act now,” says Morency. Energy flexibility is fundamental for businesses to deal with the growing demand of energy. To lead in the climate crisis means factoring climate risk into business strategy and identifying opportunities to drive change.

For example, with Canadian buildings still accounting for almost 30 per cent of all emissions, building designs must target zero carbon now if Canada is to reach its goals. “We see transactive energy models becoming a reality where buildings with onsite energy generation would be able to sell their energy back to the grid or with other buildings around them,” says Morency. “Microgrids in a building contribute to creating energy flexibility by enabling us to prioritize in a dynamic way energy efficiency and cost savings, resiliency and reduce CO2 emissions.”

Digitization

Connectivity is increasing the speed, capacity, and reliability of data transmission. “Embracing connected technology and reaping the benefits of digital transformation are critical to reliable and energy efficient solutions for our buildings, factories, transport, and even our homes,” says Morency.

With massive amounts of data flowing from IoT devices, businesses and decision-makers are in information overload. For businesses to action this data, they need the tools and technology to analyze it. Investing in agnostic software solutions can create greater efficiency and resilience, reduce unplanned downtime, and preserve investment value for the long-term. For example, some of the most advanced software available on the market right now issues reminders for maintenance updates and can generate QR codes for electrical panels that facilitate communication between the customer and the building owner.

Integrating process and digital energy technologies and software can help businesses enhance safety, reliability and sustainability. Connectivity is what enables data collection and analysis, so by measuring, monitoring and optimizing energy use, businesses can use connected technologies to make the most out of their resources, reduce waste and make smarter decisions.

The electricity transition

The accelerated transition towards renewable energy is placing a renewed focus on the way electricity is produced, stored, and used by businesses. Morency added, “the increased use of electricity for heating and transportation, and the multi-directional flow of information and energy are contributing to the reinvention of the electricity sector.” There is a growing emphasis on a more decentralized system providing a clean, reliable, and resilient supply of electricity through a grid that supports multi-directional flows of energy and information between producers, consumers, and “prosumers” – buildings and households that both take from and contribute electricity to grid.

One place these ideas are being translated to reality is the partnership with the Centre for Grid Innovation at the Northern Alberta Institute of Technology (NAIT) in Edmonton where Schneider Electric’s EcoStruxure Microgrid Operation (EMO) is being installed to extend the Centre’s capability to support Alberta businesses in the testing and implementation of distributed energy resources (DER).

“Distributed energy resources are becoming an increasingly favourable option for consumers and distribution entities, especially as the demand for energy grows in popularity,” says Morency. “NAIT’s Centre for Grid Innovation is an exciting step forward for Alberta’s changing energy landscape, providing small and medium enterprises with the ability to develop, test and optimize their solutions against real-world factors. We’re excited to partner with NAIT to support Alberta’s growing distributed electricity sector.”

Engagement and the human dimension

None of this is possible however without engaged citizens empowered to make bold decisions and hold their businesses accountable. “The pathway to carbon neutrality and net zero emissions is achievable,” according to Morency. He’s quick to point out, however, it is the human dimension that determines success or failure. “We have the greatest success when senior management takes a leadership position and works collaboratively to develop a comprehensive strategy to meet both business objectives and climate commitments, driving both profit and purpose. This is a journey, and we are all on it together.”

The collaboration between Schneider Electric and Maple Leaf Foods exemplifies the results that can be achieved when CEO leadership and Board commitment are aligned with sustainability goals and science-based targets. Science-based targets show companies how much and how quickly they need to reduce their greenhouse gas (GHG) emissions to prevent the worst effects of climate change. As the leading North American producer of meat and plant proteins and the first major food company in the world to be carbon neutral Maple Lead Foods acknowledges the impact of the global food system on the environment and the urgent need for transformative change to reduce global greenhouse gas emissions to zero. “Maple Leaf Foods deep commitment to sustainability leadership is carving the path for others to set bold environmental goals and most importantly – act on them,” said Morency.

With an aggressive target of reducing emissions 50 per cent by 2025, Maple Leaf Foods is well on its way to its ultimate goal of reducing its carbon footprint to zero. Since 2015, the company has reduced over 86 million kilowatt hours of electricity – equal to 12,912 passenger vehicles driven for one year — and over 4.3 million m3 of natural gas, which equals annual energy usage for 1,000 homes. Through its water conservation efforts, Maple Leaf Foods has reduced water usage by over 1.2 billion liters. They are also investing in wind energy, landfill gas methane recovery, composting and biomass programs to reduce methane emissions, and forest protection and re-forestry to conserve species and biodiversity.

The path towards a zero-emission future isn’t just being socially responsible for the short-term, it’s about survival in the long-term,” said Morency. “Canadians rightfully expect business to be at the forefront of these solutions, and we’re here to do exactly that.”

The post Key Megatrends Driving Businesses Towards a Zero Emission Future appeared first on Corporate Knights.