Business playbook: How to work toward net-zero carbon emissions

This article originally appeared on Outside_Business_Journal

The science is clear: We must get to net zero by 2050. It's a big objective--truly, a mission--requiring ambitious action start- ing right now. But taking a stand on climate doesn't have to be a budget buster; in fact, leading outdoor businesses see it as a path to assuring long-term sustainability. What's more, the global transition to clean energy is already underway, and brands that aren't evolving risk getting left behind. "The sooner you get started on it," says Bruce Usher, co-director of Columbia University's Tamer Center for Social Enterprise, "the more likely you can do it at a lower cost and more intelligently, and come up with the best practices for your business."

How, exactly, do you start? We put together the strategies that will have the greatest impact on your company's carbon footprint, from leaning on factories to produce your gear with renewable energy to upgrading appliances at HQ. Some steps are entirely within your control. Others require collaborating with industry partners and using your economic influence. Do that, and your business can make significant strides right now.

Step 1: Measure up

The first step in any net-zero plan is taking an inventory of your business's carbon footprint--a process divided into three levels, or scopes.

Scope 1: The first one is fairly easy. Look at the direct emissions that occur from sources that you own or can control-- known as Scope 1. These can include emissions from company vehicles, boilers and furnaces, and on-site equipment.

Scope 2: The next step is examining indirect emissions, which don't occur at your facility, but are part of your energy footprint nonetheless. This is Scope 2. Some examples are electricity used for lights and on-site heating and cooling.

Scope 3: This scope, which covers emissions from your supply chain and product use, is the trickiest--and most important. Whether you make tents, water bottles, or wool socks, Scope 3 likely accounts for 65 to 80 percent of your company's total carbon footprint. These include emissions and waste from raw-material extraction, factories, shipping, manufacturing, employee commuting, business travel, customer-to-store travel, investments, and product end-of-life.

Jeannie Renne-Malone, vice president for sustainability at VF Corporation, and her team have found that raw material extraction, processing, and manufacturing account for the majority of the company's climate impacts; VF Corp's direct operations only account for 1 percent of total emissions across their inventory. "So now we know to put the majority of our emphasis on raw materials and factory operations," Renne-Malone says. That includes a vision to source 100 percent of their company's top nine materials from regenerative, responsibly sourced, renewable, or recycled sources by 2030.

Read more: 3 outdoor companies hit hard by climate disasters

So how do you figure out your company's total emissions? Bring in the experts. The nonprofit Climate Neutral has so far helped 337 brands measure (as well as reduce and offset) their carbon emissions. REI's director of sustainability, Matthew Thurston, says the co-op joined Climate Neutral because the nonprofit brought a high level of methodology and standardization to the process. Another option is Cooler, the company that Outside Inc. selected to measure and neutralize the footprint of OBJ and the other brands in its portfolio. Cooler uses peer-reviewed calculators to help businesses figure out their total climate impacts, and its software enables brands to display product footprints and carbon reduction data at checkout.

Step 2: Commit

Your next step is committing your company to science-based targets* for reductions. But making a lofty promise isn't enough--you need interim goals to keep everyone accountable. "By not setting interim targets, many companies fall short of the climate ambition needed," says Amy Morse of the Environmental Defense Fund. "They're just setting a distant goal of net zero by 2050 without having a robust near-term action plan."

A meaningful pledge must include:

• Interim goals, such as cutting emissions by a certain amount each year and by 50 percent by 2030

• Concrete plans, for near-and long-term reductions in specific segments of your business

• Transparency, through public progress reports that create accountability and share valuable findings

*Greenhouse gas-reduction goals that are in line with the latest climate science. They require cutting emissions in half by 2030 and achieving net-zero emissions by 2050. The Science-Based Targets initiative helps businesses make meaningful commitments.

Step 3: Reduce, reduce, reduce

Once you’ve figured out your company's emissions, it's time to slash them as aggressively as possible. Your plan of action will depend partially on what you're selling, but these measures are both significant and entirely under your control.

• Switch your company fleet to electric vehicles

• Move to 100-percent renewable energy. Consider direct solar and wind installations in all buildings and/or power-purchase agreements with utilities.

• Make your building as energy efficient as possible. Take steps like installing LED lights and efficient appliances

• Commit to zero waste. Enhance your recycling and composting programs

• Support sustainable employee commuting. Provide incentives for biking and using public transportation, and/or expand work-from-home policies

Step 4: Embrace better design

Use the most sustainable raw materials possible. "If you can use the recycled equivalent of raw materials--nylon, polyester, aluminum--that can take out a big chunk of emissions," says Michael Sadowski, a research consultant at the World Resources Institute (WRI) and for Outdoor Industry Association's Climate Action Corps. Beyond recycled, look for biobased and regenerative material substitutions. Though some ingredients may cost more initially, a recent WRI report notes that greater demand will increase production and drive down prices.

Support the R&D of innovative green materials, like mushroom-based leather (as adidas is doing with Bolt Threads) or fabric made from recaptured waste-carbon emissions (a project lululemon and LanzaTech have partnered up on).

Reduce or eliminate the need for textile dyeing and finishing. Many textile mills rely on coal-powered boilers to produce the heat necessary for fabric processing, but "there are plenty of design things you can do [to reduce emissions]," Sadowski says, including waterless dyeing, no dyeing at all, and minimal finishes.

Eliminate single-use plastic packaging in favor of greener alternatives like reusable bags and compostable wrappings.

Step 5: Make less, and make it last

“Ultimately, even if we reduce emissions, we're still creating impacts," says WRI's Sadowski. "So we have to make less stuff in the beginning, and figure out a way to keep goods in life for longer. If you can make one jacket that lasts for 10 years versus making 10 jackets that last for one each, you're going to dramatically reduce the impact of that jacket."

Yes, your CFO will immediately recoil at this idea. But conscientious consumers will pay more for higher-quality, lower-impact gear. And many brands are taking the climate crisis as a challenge to diversify their businesses. Some are streamlining their designs and operations to reduce costs (and carbon). Others are setting up rental programs, adding repair services, and adding used-gear sales to create new revenue streams.

Step 6: Push your partners

The more ambitious outdoor businesses are in their climate goals, the stronger the message they'll send to manufacturers, materials producers, shipping partners, and providers of renewable energy: Business customers want zero-carbon options and expect the industry to rapidly accelerate its decarbonization efforts. Why is this so important? Because the number-one source of emissions for most manufacturers is the energy used to power the factories where our gear and apparel are made.

This transition won't be easy. Most manufacturing happens overseas, and therefore depends on each country's supply of renewable energy. "You want to go to your manufacturer and work with them to install rooftop solar," Sadowski says. "Historically, that's a challenge because brands haven't necessarily paid for it. But if we want to green the supply chain, we have to make investments."

Read more: Climate change poses an existential threat to outdoor recreation

The Clean Energy Investment Accelerator (CEIA), a public-private partnership, can help by turning company funds and purchase commitments into new renewable-energy projects. REI is now working with the CEIA on the clean-energy transition in Vietnam and Indonesia. "We think there's a substantial opportunity to expand renewable energy access in those countries," REI's Thurston says, "and we want to make sure it's clear that part of the value proposition for us working in the countries is that they are going to be progressing toward fully sustainable or fully renewable energy."

Therein lies the stick, as opposed to the carrot: Let manufacturing partners know your business depends on their decarbonization.

Step 7: Find strength in numbers

And what if manufacturing partners don’t agree to switch? "If you're a large brand and have a good portion of a facility's production, you can go to the factory and say, 'This is what we'd like,'" Sadowski says. Smaller brands with fewer orders don't have that leverage. "That's where multibrand collaboration becomes really important."

OIA's two-year-old Climate Action Corps is working on just that kind of joint effort. Led by Amy Horton, senior director of sustainable business innovation, the initiative brings together brands to investigate the scaling of lower-carbon materials like recycled nylon within the industry's supply chain; get more accurate carbon footprint data; and push factories to embrace renewable energy.

Step 8: Ship greener

How products travel from factories to your stores and warehouses is a big source of Scope 3 emissions. Currently, annual maritime container shipping emits as much carbon as the entire national output of Germany--but cleaner fuels exist. The Aspen Institute's Cargo Owners for Zero Emissions Vessels coalition brings together companies to push for decarbonization in their shipping partners. Members--including Patagonia, Brooks Running, and Frog Bikes--commit to ship only with vessels powered by zero-carbon fuels by 2040.

Step 9: Speak up

Nick Sargent, president of Snowsports Industries America, says that advocating for strong climate policies is the most important thing the outdoor industry should be doing. "It's great that our industry is reducing its own corporate emissions, but frankly, we're not going to solve climate change if that's all we do," he says. "It's vitally important that we use our voice to drive systemic change as part of a much broader climate strategy." That means making noise in Congress to support climate-smart legislation, like the renewable energy and electric vehicle provisions in the recent infrastructure bill, and donating to candidates who support strong action.

Money talks beyond Capitol Hill, too. Banks compete for big corporate accounts: By choosing to bank with institutions that don't invest in fossil fuel development, companies can use their financial leverage to reduce emissions. "As businesses move funds away from the banks funding fossil fuel projects, executives, boards, and stockholders will begin to see financing fossil fuel projects as a liability to their bottom line," says Mario Molina, executive director of Protect Our Winters.

Step 10: Now, forget climate neutrality

We’ve been hammering the importance of climate neutrality for pages now, and the latest IPCC report* tells us to cut emissions in half by 2030 and be net zero by 2050. But let's do one better. OIA's Climate Action Corps has chosen more ambitious targets by focusing on a "climate positive" goal, Horton says. That means that companies shouldn't just cut emissions--they should actively seek ways to remove more carbon from the atmosphere than they emit. "We need to ratchet down the timeline much earlier for this industry," Horton says.

Read more: What can the industry do to have a real impact on climate?

The Corps seeks to get the entire outdoor industry to climate positive by 2030. A key part of that goal is investing in projects that use nature to sequester carbon (which, incidentally, may have dual benefits for recreation through better water quality and wildlife habitat). Examples: forest regeneration, soil carbon sequestration, regenerative agriculture.

*IPCC Reports: periodic warnings about the accelerating risks of the climate crisis from the UN’s Intergovernmental Panel on Climate Change.

Step 11: Be fearless

At the end of the day, says Sadowski, what we need most is courageous and visionary leadership. "It takes bold leaders at companies to just put stakes in the ground and say, 'This may cost us more, but we're going to do this because it's the right thing to do, and the economics will catch up.'"

This story first appeared in the Winter 2022 issue of our print magazine. Read the full issue here.

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