Success factors for a robust Climate Transition Plan
In our experience working with various organisations, we see several success factors to consider for the preparation of your Climate Transition Plan
Realistic assumptions
Realistic assumptions are essential to your Climate Transition Plan because they provide a grounded and achievable pathway to reducing emissions and adapting to climate challenges. Setting overly ambitious or unrealistic goals can lead to discouragement and inaction. At the same time, practical assumptions help identify where immediate efforts can be made and where adjustments can be gradually incorporated over time.
Connecting the CTP to a broader set of topics
When creating a Climate Transition Plan, we are working with topics deeply interconnected with other areas of sustainability. Actions and policies around other environmental issues, such as pollution, biodiversity, resource use, and circularity, are linked to the emission reduction goal. However, social and governance aspects also influence the Climate Transition Plan. Policies on working conditions determine emissions related to business travel and commuting. In contrast, supplier relationship management and procurement policies can strongly influence shifting towards more sustainable products with lower emissions. Therefore, when working on a climate transition plan, it is crucial to include experts from your different business units in the discussion to gain a complete picture of the implications of the mitigation actions.
Management buy-in and alignment with your company strategy
A Climate Transition Plan should be considered a strategic tool to help a company mitigate risk, uncover opportunities, and secure a competitive market position by proving sustainability credentials. As such, involving decision makers early in the process is crucial. Decisions linked to the Climate Transition Plan can determine company strategies, and vice versa, and often require large, significant, short-term investments to pursue actions that aid climate change mitigation.
The most crucial step is to get started and commit to the process, taking action, even if it is not perfect. It is better to make progress with a sound methodology and continuously refine the approach than to delay or abandon efforts for fear of not meeting ideal targets. Regularly tracking progress, revising assumptions as more data becomes available, and remaining flexible are essential to ensuring an effective and adaptable transition to changing circumstances. The key is to maintain momentum and keep improving rather than waiting for perfection.
Reporting and communication
A Climate Transition Plan can be part of a company’s overall Sustainability Statements, as described in the ESRS, but can also be published as a standalone report. It is a powerful communication tool for stakeholders such as potential clients, future employees, investors, and peers. Throughout the development of the Climate Transition Plan, it is essential to keep in mind that not all information will be part of the final report. There should be a balance between the information and steps needed for implementation, and a plan should be created that your company is comfortable sharing with the public.
Note on current regulatory developments
The Science-Based Target Net Zero Standard and the GHG Protocol are undergoing an extensive methodology review. While the details of these standards are still under review, a consistent trend towards better and more traceable data is needed to show change in working methods and progress towards targets. Therefore, we advise your company to focus on its data collection and supplier engagement strategy and closely track calculation methods and assumptions in the Climate Transition Plan.
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