Getting to grips with Net Zero

As we emerge from the COVID19 pandemic, questions have been raised about the way we live, work and what we prioritise in our lives.

In November the UK hosts the UN Climate Change Conference, COP26, further raising questions on how we move on from the pandemic.

As businesses and business owners, we all have an impact on the world. Increasingly consumers (and governments) are requiring that our impact is a positive one.

“Net Zero” is a term that dominates discussions as part of this, yet seemingly came out of nowhere. Searches are up 3,000% in the past 2 years alone. However, there is still little clarity on what it means for small businesses.

So what is Net Zero?

Net Zero refers to the balance of greenhouse gas emissions. At a national level, it is the total amount of emissions emitted vs the amount of emissions captured (e.g. through tree planting). Net Zero refers to all greenhouse gases such as Methane and Nitrous Oxide, as well as Carbon Dioxide.

As a business, achieving Net Zero requires you to be responsible for your “carbon budget” – i.e. how much you emit. If you emit 100 tonnes of CO2 in a year, and do no carbon offsetting, then you are a way off from net zero.

If however, you reduce your emissions to just 10 tonnes a year, and offset the remaining 10 tonnes through tree planting or similar schemes, you have achieved net zero.

It is beneficial for companies to begin thinking about their carbon emissions as soon as possible, and thinking about them like you would a financial transaction. Too much financial debt and a business risks becoming unsustainable, unprofitable and risks collapse. Equally, failing to reduce your emissions and leaving too much carbon debt in your business and regulations in the future may pose a significant threat to your operations.

It’s important to note that different regions have different Net Zero targets. The UK wide target is 2050, though for Scotland it is 2045. Brighton, Bournemouth, Bristol, London, Glasgow and Edinburgh are all aiming for 2030. Other UK cities fall in between these dates.

With such an appetite for change, expect Net Zero dates to become more ambitious, not less.

The earlier you get to terms with it, the better. While carbon taxes or carbon accounting are not yet in place, they are on the COP26 Agenda and it’s a matter of when, not if.

Getting on top of your emissions now and achieving net zero ahead of time, aside from the environmental benefits, will help your business be more prepared for uncertainties the future holds.

The sooner you get started on your journey, the sooner you’ll arrive at a more sustainable, resilient and positive business.

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