Net-zero planning delivers measurable advantages in the transition process

In recent years, companies have been struggling to refine their strategies to keep pace with net-zero aspirations within markets. Although desired, net-zero commitments are, in some instances, working counterintuitively to growth and achievable outcomes as the speed of climate change acceleration forces change. Nevertheless, most businesses have yet to make clear, detailed plans for how they will achieve net-zero. If it is difficult for leaders to decide the right approach to climate change, it creates further ambiguity for companies to follow the directives that help pave the way to net-zero. Part of the ambiguity in defining the right fit strategies for companies to take when considering climate change is that governments are falling short of planning adequately or on the implementations and further iterations of their original plans. It is, however, a very complex path to navigate economic growth and climate change initiatives as some initiatives work against growth in the short to medium term.

Some complexities arise from economic considerations like the hit Australia would take to its GDP if it decided to slow its coal exports or if it decided to impose a tax on mining, for instance. Ripple effects in the market would push back on governing powers, and eventually, changes would be made to the very top layer of the government. Jobs growth and labour demands must be in step with future trends, and finance must be in toe with the directives that lead to measured outcomes. Leaders are focusing on these issues with various lenses and points of view. Investors and regulators expect that solutions will be made to address the ambiguity faced in markets.

Leading by example

Public companies should be required to release net-zero plans by 2023. It would be remise for planning and strategic purposes to fall short of providing some sound evaluation as to how public companies intend to navigate climate change and the transition to net-zero. Boards, CEOs and leaders of public organisations must set an example for private companies to follow. The most compelling strategies will convince net-zero planning, distinguishing companies from peers. Such planning will vary in specifics, but well-formed ones will feature the core elements that can be foundational blueprints to keeping pace with ever-evolving change.

The purpose of planning but having the flexibility to adapt to change is imperative to meet any desire to reach carbon neutrality. The current planning lens must focus on a timeline that spans no further than 2030, as anything beyond that has a greater possibility of being somewhat redundant when change shifts too far from predicted goal posts. 2050 is too far a target to plan for with most things that do not require significant long-term infrastructure spending. Scientists are finding that some of the predictions they made only a decade ago are not accurate today, as greenhouse gas emissions have contributed to rising seas, coral bleaching and more erratic weather.

Competitive advantage from bridging gaps

Companies must evaluate scientific predictions as well as economic turns when devising their climate risk assessments. Furthermore, the social impacts of a warming planet and the risk of doing too little too late make strategic determinations even more of a conundrum to fathom. Yet, there is still time to find value in transitioning early and the trust afforded to companies that achieve early success in carbon planning, and the reduction of CO2 will discover they are trusted by consumers and will be emulated in markets.

The competitive dynamics of various industries and environmental exposures within sectors go hand in hand in mitigating climate risks as opportunities are found in the gaps. Tactful positioning, early positioning and well-articulated strategies form the fundamentals that appease investors. The allocation and spending of transition capital required to reduce emissions could see returns made faster when governments incentivise swift action and reward companies for early shifts and compliance via reduced taxes.

Carbon Accounting

Carbon credits must be utilised when internal measures to reduce carbon emissions are exhausted, but deficits remain. Carbon accounting will come into effect to balance ledgers and maintain a traceable, auditable record of calculations year on year. At Ocean Blocks, we aid companies in defining and redefining their strategies for achieving carbon neutrality. We help build customised programs that align all participants and stakeholders.

Good plans take time to prepare, yet business conditions are changing rapidly. It is concluded that lack of action in these times is more detrimental to a business than attempts made in the right direction that may not deliver as expected yet, still, achieve positive steps toward net-zero. Begin the climate change planning process with Ocean Blocks and make sure steady, calculated moves that will generate value are enacted. We help companies plan for their future instead of the future defining the company.

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