The UK became the first major economy in the world to pass laws in 2019 aimed at ending its contribution to global warming by 2050. The UK’s previous target in decreasing greenhouse gas emissions was to achieve at least an 80% reduction from its 1990 levels. The more recent target requires all greenhouse gas emissions to meet net-zero by 2050.
If you don’t know where to start on your journey along net-zero, here are some useful steps you can take:
Step 1 Understanding
Firstly, it is important to understand your business’s carbon footprint and how this will impact the environment. You might already be doing this through SECR*, ESOS* or as part of a larger CSR initiative. Knowing this will surely give you an advantage over your competitors.
To put it simply, the following can be defined as –
Scope 1 & 2– Emissions from purchased energy or from ‘owned sources’
Scope 3 – Emissions from your supply/ value chain
Step 2 Relevance
Once you understand this, the second step in the journey is to figure out how this fits your business and operations. There needs to be a consideration across the whole value chain, from “raw material to the end customer“. Reviewing carbon-intensive processes will allow you to focus your decarbonisation efforts in the appropriate place.
Step 3 Recognition
Recognise that your net-zero journey will face risks or barriers. Everyone always expects that the main hurdle will be cost (upfront investment), but the barriers are institutional, technological or psychological in most situations. Try to figure out what these might be in your business and how to you can overcome them.
“Change has to be hard because you’re fighting against inertia” – James Thornton
Step 4 Identify
Identify who the person or people are that will drive this forward. Do you already have that person or do you need to recruit? Outline the roles and what is necessary.
Step 5 Set goals
What is your ideal endpoint? Are there any key milestones you will need to reach along the way? Remember these three key elements:
- Use less
- Use better (A strong focus on innovation can lead to brand enhancement and ultimately opportunities for your business)
- Offset (once carbon emissions are reduced to the minimum)
A strong focus on innovation can lead to brand enhancement and, as a result, business opportunities.
Step 6 Engage
Engage with your staff and stakeholders. Make sure everyone is aware of what you are doing and why you are doing it. Encourage employees to give feedback and ideas. Customers will also want to hear about your plans – you are part of their supply chain after all.
Step 7 Embed change
Ensure that initiatives align with and complement the wider business strategy. You need to ensure that this becomes a key element to business operations and not an add-on. It will ultimately fail if not embraced and entrenched in the core business function.
Step 8 Implementation
Implement and see how it develops.
Join us on this journey
Menzies LLP are on this path themselves and have faced many of the hurdles and obstacles. We would be willing to assist by sharing experiences with you as you embark on your journey to net zero. Please contact us with any queries you have.
*ESOS – Energy Savings Opportunity Scheme
*SECR – Streamlined Energy and Carbon Reporting
Menzies is a top 25 leading firm of accountants, finance and business advisors that operate out of a network of offices across Surrey, Hampshire and London, providing our clients with easy access and local knowledge. Described as the ‘best performing firm outside of the top 10’ by Accountancy Magazine, Menzies has over 400 employees and an annual turnover of more than £40m.
