Understand the Business Role in Climate Mitigation

Due to the size of their emissions and their economic influence, technological capabilities, supply chain impact and stakeholder reach – companies play an active role in mitigating climate change. By leading the way and taking proactive measures, businesses can contribute significantly to global efforts to address climate change in the following ways.  

1. Implementing mitigation strategies to reduce greenhouse gas emissions: Businesses are major contributors to greenhouse gas (GHG) emissions through their operations, supply chains, and products. By taking action to reduce their emissions, businesses can have a substantial impact on overall GHG emissions. 
2. Driving innovation and technology for sustainable solutions: Businesses are often at the forefront of innovation and technological advancements and have the capacity to develop and deploy new technologies, processes, and solutions that can enable a transition to a low-carbon economy. 
3. Integrating sustainability into supply chain management and promoting responsible sourcing: Businesses can exert influence throughout their supply chains by promoting sustainability practices among suppliers and partners. Encouraging and collaborating with suppliers to reduce emissions and adopt sustainable practices can have a cascading effect on emissions reduction. 
4. Advocating for strong climate policies: Businesses can use their influence to advocate for net zero-aligned policies and engage with governments in shaping regulations that promote sustainability. Companies can also provide expertise, data, and insights to policymakers, facilitating the development of effective climate policies. 
5. Educating and engaging consumers to make climate-conscious choices: Businesses shape consumer behavior through their products, services, and marketing. By offering climate-friendly options, raising awareness, and promoting responsible consumption, businesses can drive demand for low-carbon solutions. 
6. Transparently reporting on emissions, climate risks, and mitigation efforts: Transparent reporting on GHG emissions, climate risks, and mitigation efforts is essential for businesses to be accountable and demonstrate progress. Through sustainability reporting frameworks such as the Task Force on Climate-related Financial Disclosures (TCFD), businesses can communicate their climate mitigation actions to stakeholders, including investors, customers, and the public. 
7. Meeting investor and stakeholder expectations: Investors and stakeholders increasingly prioritize environmental, social, and governance (ESG) factors, including climate performance. Businesses that demonstrate a commitment to climate mitigation are more likely to attract responsible investors, gain access to capital, and maintain positive relationships.

What should companies focus on today?

In 2022, the United Nations’ High‑Level Expert Group on the Net Zero Emissions Commitments of Non-State Entities set out to develop standards for net-zero emissions pledges. These recommendations should be seen as the end goal for corporate action on climate and we recommend companies review the Integrity Matters: Net Zero Commitments by Businesses, Financial Institutions, Cities and Regions report for their detailed recommendations.

To achieve net zero goals in line with the 1.5°C pathway, EDF recommends that companies cut their absolute GHG emissions across operations and value chains dramatically by at least 90% by mid-century, balance any remaining emissions with high-quality carbon removals, and transform their business in the process to align with a just and equitable global net zero future. 

Reaching net zero requires companies to undertake several key actions: 

1. Establish long-term science-aligned emission reduction targets that are in line with the 1.5°C pathway. These targets should aim to reduce absolute GHG emissions – including short-lived climate pollutants like methane – from both their operations and value chain, as outlined by the Science Based Targets initiative (SBTi).
2. Companies must back their long-term commitments with short-term, science-aligned emissions reduction targets for both short- and long-lived GHGs (most notably methane and CO₂, respectively).
3. In the transition to net zero, companies should balance their remaining emissions by purchasing high-integrity reduction or removal carbon credits – especially those that protect critical ecosystems and carbon stocks. At net zero achievement and beyond, companies should balance unavoidable emissions with high-integrity carbon removals.
4. Commitments must be accompanied by a transparent implementation plan outlining a near-term plan and pathway to achieving the goal, with additional emphasis on policy advocacy aligned with the 1.5°C pathway and a just and equitable transition to net zero.
5. Take action early – reducing emissions now yields better long-term climate outcomes and can make reaching net zero cheaper and easier in the long-run.