U.N. ‘Race to Zero’ campaign toughens standards for company net-zero plans
The UN-backed Race to Zero campaign, launched to increase and unify climate ambition and action globally, has today (15 June) updated its minimum membership standards. Among the new additions are requirements to end fossil fuel finance and lobbying which goes against climate science.
Race to Zero was launched by the UK Government in June 2020 in the lead-up to COP26. Over the past two years, it has grown steadily, with thousands of individual sub-national actors including businesses and cities signing up.
Today, the campaign has updated its criteria for membership, following an international consultation that received more than 200 comments. The criteria come into effect immediately for new joiners, while existing participants will have 12 months to update their approaches if needed.
Added to the ‘Starting Line’ criteria – the minimum set of requirements for Race to Zero participation – is a requirement for all members to “phase down and out all unabated fossil fuels as part of a just transition”. Major fossil fuel firms themselves have always been barred from participating, but the new requirement applies to all members, including businesses with minority activities in the sector or which are providing financial or other support to the sector. Race to Zero states that this change serves to make explicit the standards to which it has always sought to uphold.
A note about this change in the campaign’s new implementation guide for the updated criteria states that “‘fossil fuel phase down and out’ does not refer to a single universal date for all entities and sectors, but should instead be aligned to a global, science-based, just transition”.
“For example, the International Energy Agency’s 2021 Net Zero scenario envisions an immediate halt on building new coal plants and a phaseout of coal-fired electricity generation by 2030 in OECD countries and 2040 in non-OECD countries, as well as no new oil and gas fields.”
Another new requirement is for all participants to publicly release a transition plan document on their long-term net-zero goals and their 2030 targets. Such a plan should detail how emissions reductions will be achieved, including finance. It should also outline plans for twinning climate action with social sustainability, including information about upskilling or reskilling workers in high-carbon sectors. The UK Government is notably set to introduce a transition plan mandate for all large businesses in the highest emitting sectors in 2023. It is then likely to be extended.
Additionally, Race to Zero will require its members to “align their lobbying and advocacy activities with net-zero by proactively supporting climate policies at the subnational and national level consistent with the Race to Zero criteria”. Lobbying topics named explicitly in the implementation guidelines include low-carbon energy, low-carbon transport and nature.
Within 12 months of joining Race to Zero, members will need to publicly list their trade association affiliations and provide information about their governance structures for policy engagement. Existing members will have until 15 June 2023 to provide the same information. Race to Zero has said it will ask organisations to leave trade associations that “persist in not aligning with scientific pathways”, and that it may rescind membership if organisations fail to do this.
“We urge all Race to Zero actors to keep stepping up, or risk being removed from the Race,” reads a joint statement from Nigel Topping and Mahmoud Mohieldin, High-level Climate Champions for COP26 and COP27 respectively.
The campaign’s announcement comes days after Net Zero Tracker published its latest global stocktake of net-zero commitments. This revealed that more than 90% of global GDP is now covered by some kind of net-zero target, but that not all of these targets are credible, science-based and backed with appropriate delivery plans.
As well as updating its minimum participation requirements, Race to Zero has made changes to its ‘Leadership Practices’ – a list of actions which should be taken by organisations looking to lead the transition to a net-zero global economy. The campaign expects all members to undertake “at least some” of these Practices, it has stated.
Practices already noted before today’s update include the development of targets which are more ambitious than net-zero ambitions, such as absolute zero targets or net-negative emissions plans.
New additions are centred around three key themes: nature, stakeholder empowerment and contributing beyond their own value chains and geographical locations.
On nature, the updated criteria state that leading organisations should “encourage immediate contributions to the preservation of natural carbon sinks – not necessarily linked to [carbon] compensation or neutralisation claims”. They should, specifically, support nature conservation and restoration through investment and collaboration. Businesses must also “achieve and maintain operations and supply chains free from deforestation by 2025 at the latest”.
There are no set numerical targets for the necessary level of involvement, but it has been stated that nature should be “embedded at the heart of leadership practices”.
Stakeholder empowerment, meanwhile, entails supporting other stakeholders to increase their own ambitions and accelerate their own actions to mitigate emissions. Race to Zero is urging organisations to adopt “the spirit of radical collaboration and equity”. Support can be provided in the form of financing, capacity building, knowledge sharing and/or opening access to resources.
Lastly, the new Leadership Practices information highlights the importance of businesses contributing to the global net-zero transition, beyond their value chain and location-based links.