SDG #13 - Climate Change and what to do about it

In the aftermath of COP26 and the Glasgow Climate Pact, what can SMEs do to restrict their impact on the climate?

2019 was the warmest year on record and the decade ended as the warmest recorded in history.CO2 emissions have also hit a new record, but seem yet to peak. The SDG of November is Goal #13 Climate Action. While climate change and global warming are part of mainstream discourse, global temperatures are still on the rise. With current emission levels, society is off-track to achieving what was promised in the Paris Agreement ie. keeping the temperature rise under 1.5°C.

If we fail to achieve these goals by 2030 we risk inflicting irreversible damage to our planet, and destroying habitats, and livelihoods.

After UN Secretary General, António Guterres labelled the Glasgow Climate Pact ‘not enough’ to combat climate change, COP26 closed with hopeful promises, but also a sense of urgency to genuinely take action this time. So instead of sitting back until COP27, we must switch into ‘emergency mode’ - each in their own way. SMEs account for 90% of businesses worldwide, giving employment to a considerable amount of people. Their climate action is therefore instrumental to the success of society in achieving NetZero. However, many are unsure where to start as there are financial and logistic barriers that are a challenge to overcome.

so, what is climate action and how can businesses take it?

As CO2 emissions are the single largest contributors to climate change, Step #1 should naturally be to minimise your business’ carbon footprint. Apart from wanting to preserve our planet, businesses must think about decarbonisation as a competitive advantage. As an encouraging trend, large companies are predicted to be increasingly less likely to source from highly polluting smaller businesses, threatening the existence of those reluctant to take action.

The switch to a zero-carbon economy is expected to be the fastest economic transition ever, and it is well worth getting ahead of the game by starting to think sustainably. The E in ESG is especially salient: think about your environmental policy and draft a NetZero policy that pledges to join the race to zero. The 1.5 °C Business Playbook developed at the World Economic Forum sets out a plan on how to commit to exponential climate action.

You will want to commit to cutting emissions in half at least every 10 years. To do this, they outline 4 pillars:

● Start with your immediate emissions

● Turn to Scope 3 emissions in your value chain

● Prioritise a business strategy that is in line with a NetZero initiative

● Take your ambition outside: lobby for policy, join alliances and spread the sustainable word

How to translate these promises into action?

The answer is in the details. Once you are done setting the main goal (e.g., halving emissions by 2030), create achievable sub-targets

Invest in renewable energy and increase energy efficiency. Quite obvious, isn’t it? Switch to a 100% renweable energy provider to service your premises. Lights and computers should be turned off when unused, and a smart meter installed. However, you can take this far further: Think about your office space and if it could be more efficient - is it insulated well? Is it the right size for your company? Do you need the AC Unit to be centrally controlled? Have you got a Hot Desking policy in place so that space is saved on individual offices?

Then, think about business travel. In our post-pandemic reality, business meetings held online are now the norm, and you can do your part by only taking essential trips - preferably domestically, and by train. If your business is selling goods, consider the lifecycle of your products. What happens once consumers are done using it? Can it be recycled? Can you arrange for it to be donated or returned to you for repurposing? Circularity is increasingly considered the way to go when thinking about reducing emissions within a business model, as it minimises waste and makes your production more efficient. Invest in fully recyclable packaging, and aim to source it from recycled materials in the first place. When thinking about shipping, think electric vehicles, pooling with other businesses, or hyperlocal communities

SMEs often face particular difficulties when trying to tackle climate change due to size and the associated budgetary/logistical constraints. The most important thing therefore is to adopt a green outlook for the future. Invest and spend with the climate in mind: As you grow, you will face decisions on office choices, shipping products, marketing, and many other aspects of your business. Make decisions with emission factors and circularity in mind. Lastly, only when you cannot reduce the emissions of an activity, should you offset and compensate them.

Once you have pledged to race to net zero, use the resources available. The race to NetZero is a journey, and it is important for stakeholders to see targets, how they will be achieved and where you are in getting there. After reports, comes evaluation, adjustment, adoption and reporting again. As you take climate action, claim your achievements but be transparent and honest.

COP26 brought awareness about the importance of supporting SMEs on their journey towards NetZero emissions. The ESGmark® Community is here to support you with drafting policies, reducing your environmental footprint and forming connections with like minded businesses.