Transitioning to Net Zero for Retail

We are very excited to be supporting the UN Global Compact Network UK’s ‘Transitioning to a Net Zero’ webinar series.

The webinar in the series, ‘Transitioning to Net Zero for Retail’ took place on Tuesday, 12 October 2021 and featured guest speakers:

• Laura McGonigal, Head of Sustainability, Aesop;
• Andrew Opie, Director of Food and Sustainability, British Retail Consortium;
• Olwen Smith, UK & Worldwide Regional Lead, Commit to Action Programme, CDP & part of the Science Based Target initiative’s Corporate Engagement Team;
• Anna Turrell, Head of Environment, Tesco;
• and Sophie Wilson, Consumer Industries Lead, COP 26 High-Level Climate Champions Team.

The key takeaway points are set out below along with the webinar recording:

• The Science Based Targets initiative (SBTi) has recently launched an economy-wide net zero standard ahead of COP26.
• In the UK, the retail sector is one of the largest emitters of greenhouse gases, with value chain emissions of approximately 215 MtCO2e (million tonnes CO2-equivalent) per year. This means that the retail sector can contribute significantly to the decarbonisation of the UK economy.
• At present only 5% of retail businesses by total global industry revenues have committed to reducing emissions in line with a 1.5°C target.
• Retail businesses are encouraged to join the Race to Zero, the UN-backed global campaign to rally leadership and support from all non-state actors for a healthy, resilient, zero-carbon recovery. There are two ways businesses can join the Race to Zero:
  • The Business Ambition for 1.5°C campaign; and
  • The SME Climate Hub. This is the main Race to Zero partner for small and medium-sized businesses (SMEs).
• Changes in consumer preference will play an important role in the sector’s transition to net zero. High proportions of retailer emissions are from use of purchased goods (56% in the case of Aesop and 42% in the case of Tesco):
  • To address this, Tesco are increasing the availability of lower-carbon products such as meat free alternatives.
  • Aesop believes that customers should not be held responsible for the emissions which they emit whilst using purchased products, instead the company should reduce the product-associated emissions. In Aesop’s case, this is being done by advancing sustainable packaging projects.
  • Choice editing can play a role, but it risks putting companies at a competitive disadvantage. Therefore, it is preferable to drive demand for low-emission products through increased awareness of climate impacts.
• Retailers can significantly reduce their carbon footprint by decarbonising their logistics:
  • Tesco are utilising train and river networks to transport goods in a low-carbon way, although the capacity of these modes of transport is limited and cannot currently be fully relied upon for all transport needs.
  • The UK Government is required to support the decarbonisation of logistics through upgrading infrastructure and investing in suitable technologies.
• Supply chain emissions can make up a large proportion of a retail company’s emissions:
  • Companies at an early stage of their net zero journey should begin this process by mapping their supply chain and compiling relevant emissions data.
  • Companies should then consider setting joint sustainability targets with suppliers (such as circular economy related targets) and incentivising suppliers to set science-based emissions reduction targets (as Tesco are doing).
  • CDP offer a supply chain membership, which enables companies to request their key suppliers to report environmental data through questionnaires. This allows for standardisation of data collection.

Resources referenced during the event:

• Aesop’s approach to climate action
• Aesop’s approach to sustainable packaging
• Business Ambition for 1.5°C campaign
• British Retail Consortium’s ‘Climate Action Roadmap’
• CDP’s supply chain membership
• Race to Zero Breakthrough: Retail Campaign landing page
• Race to Zero Campaign
• Ricardo’s ‘Zero Emission HGV Infrastructure Requirements’ Report for Committee on Climate Change
• SBTi’s net zero standard
• SME Climate Hub
• Tesco’s climate change work