Nothing But Net Zero: Kickstarting the Journey to Decarbonization

13 minute read

Mar 2026

Nothing But Net Zero

Author

Oliver Balch is a British journalist and author specializing in business, sustainability, and international affairs. He contributes regularly to The Guardian, Financial Times, and Reuters. Oliver holds a PhD from Cambridge University, UK, and also works as a Senior Associate with Cambridge’s Institute for Sustainable Leadership.

Making commitments is something all companies do. Their goals differ, from hitting profitability within “X” months to topping “Y” ranking before the year-end. But their approach follows similar lines — setting targets, allocating resources, monitoring progress, and, all being well, quickly celebrating success.

Net zero, in contrast, stands out as an anomaly. It’s not that companies are reluctant to make commitments. In recent years, over 10,000 medium-sized and large companies worldwide have either published goals to balance their carbon emissions or announced their intention to do so.

Net zero: a management conundrum

The difference is that success with net zero can feel like a distant dream. Such sentiments are understandable. The vast majority of corporate net zero pledges mature in 2050, in line with the United Nations (UN) landmark Paris Agreement. In a world where most FTSE 100 chief executives last little more than five years, mid-century may as well be the next millennium.

Net zero strategies also stand out for their vagueness. Unlike other corporate goals, targets are often loose and delivery plans hazy. Indeed, new research suggests as many as five in six (84%) companies with pledges to balance their carbon footprint have no clear plan for cutting emissions in their supply chain.

Critics see such figures and are quick to call foul, arguing that corporate claims were always an exercise in “greenwashing.” With global climate negotiations struggling and net zero caught up in the spreading “anti-woke” backlash, the argument continues, and companies are now backtracking. Yet, the evidence suggests otherwise. A recent survey by World Business Council for Sustainable Development (WBCSD), for example, finds that 91% of its corporate members are “maintaining or increasing” their investments in net zero programs.

“Some companies might have jumped on the bandwagon and, yes, some of those are now quietly stepping away. But the vast majority are dead serious about decarbonizing. If anything, they’re more committed with each passing year, not less,” says Peter Bakker, president of WBCSD.

The reason is twofold, he notes. On one hand, executives in today’s C-suites are ever more cognizant of the threat that runaway climate change poses to their bottom lines. On the other hand, they are also increasingly convinced that a low-carbon transition can drive business growth, enhance competitiveness, and contribute to sustainable long-term value.

So, if companies are genuine in their intent, why the mismatch between pledges and performance? And, when seeking to implement their pledges, how do they bear the scale and cost of required actions?

The answer to both questions comes down to corporate management, not motivation. Get the strategy right, and progress will follow. That said, firms cannot afford to wait. While net zero may seem like a distant goal, the scale of the challenge demands that “must do” actions begin now. Here are three of the most critical measures — along with one tempting pitfall to avoid.

Step 1: Identify your big wins

On paper, the concept of net zero looks attractively simple. Companies need to demonstrate that both sides of their carbon ledger — the emissions they and those in their value chain release and those they help sequester or remove — are in balance.

Doing so starts (and finishes) by radically cutting emissions (see Arthur D. Little’s [ADL’s] report “Decarbonizing Industrial Heat to Face Climate Change”). Given that fossil fuels account for the bulk of most industries’ carbon footprint, it makes logical sense for firms to start there. Companies have several options here, from switching to renewables for their energy, power, and transport needs to swapping out plastics and other petrochemicals. Where phasing out fossil fuels is impractical, fuel-related efficiencies become the name of the game.

On the other side of the ledger, companies need a solution to deal with their residual emissions. To date, investing in offsetting schemes has been the default choice. However, in recent years, some leading firms have begun exploring a policy of “insetting,” whereby they support carbon-sequestration projects within their own immediate value chains (see ADL Viewpoint “Navigating the Voluntary Carbon Credit Market to Support Net Zero Targets”).

In practice, however, what seems simple soon gives rise to a complex series of decisions. Which technologies to invest in? What feedstocks, processes, or products to redesign? Which new markets to explore? To navigate this journey, a company must have a clear-eyed view of its climate-related risks and opportunities.

For Andrew Hoffman, Professor of Sustainable Enterprise at the University of Michigan, such an overview is “kind of 101” for managers. As he puts it, “If you’re going to realize net zero, actually knowing where you currently stand and where you’re heading is a no-brainer, right?”

Martijn Eikelenboom, Head of ADL in the Netherlands and Global Head of ADL’s Sustainability practice, echoes this point. Only with an accurate picture of its carbon footprint can a company pinpoint where it can make the greatest impact. And by “impact,” he means not only significant emissions reductions — which are fundamental to achieving net zero — but also opportunities for value creation, which are essential to building a viable business case.

According to the International Renewable Energy Agency (IRENA), a successful transition to net zero by 2050 could generate a cumulative net payback of “at least US $61 trillion.” That’s a sizeable prize, says Eikelenboom: “Having a solid baseline will show you where the opportunities for your business might lie, as well as what [climate-related] risks you may need to mitigate.”

Fortunately, there’s no shortage of frameworks for establishing such a baseline. One of the best known is the Greenhouse Gas (GHG) Protocol, a standardized global methodology that helps companies calculate both their direct (Scope 1) and indirect (Scope 2/Scope 3) emissions (see ADL Viewpoint “From Source to Sustainability: Decarbonizing the Supply Chain”).

Modern digital technologies and AI offer further help. Along with enabling companies to more accurately measure energy inputs and other carbon-intensive activities in their own operations, they also permit them to model their wider footprint with far greater precision.

The immediate priority, then, is to establish an effective carbon model and a consistent action plan. Scenario planning offers a useful starting point here, says Eikelenboom. Advances in computational capacity now permit companies to model multiple possibilities, assessing the economics and value at risk associated with different tactics and technologies.

Internal decision-making tools can also provide important pointers, Eikelenboom observes (see Prism article “Getting a Grip on Decarbonization with Effective Internal Carbon Pricing”). The Sustainable Portfolio Management (SPM) tool is a leading example. Developed by Belgium-based chemical company Solvay, in conjunction with ADL, the tool provides a means for consistently assessing the sustainability credentials of any product line.

SPM works by incorporating insights from quantitative lifecycle assessments (to determine products’ cradle-to-grave impacts) and qualitative market alignment analyses (to understand how products contribute to customer sustainability and market trends). These are then incorporated into a heat map tool that enables decision makers to visualize the interplay between environmental footprint and market performance. Based on this detailed overview, they are well-positioned to identify where best to invest, innovate, or transition.

“Over the years, versions of SPM have been adopted across most of the chemical industry, as well as in other industries like agriculture, healthcare, life sciences, and mining,” says Eikelenboom. The chief benefit of such an approach is the development of a “common language” on how to assess sustainability performance, he adds. As a result, should two people try to independently measure the green credentials of a certain product, they can “objectively come to the same conclusion.”

In the case of Solvay (now split into two separate companies: Solvay and Syensqo), the tool has led to a “complete shift” in its portfolio, says Eikelenboom. So, out with high-emitting materials and in with low-carbon alternatives. It has also enabled the firm to get ahead of costly regulations, he adds.

“The SPM tool is very data-driven. Well over a decade ago, for example, it flagged that PFAS [a type of man-made chemical] could present problems for the environment, for instance. In that way, it’s like a radar system that detects emerging trends and opportunities early on,” Eikelenboom concludes.

"While net zero may seem like a distant goal, the scale of the challenge demands that 'must do' actions begin now"

Step 2: Engage your ecosystem

Another net zero anomaly is that it cannot be achieved in isolation. Why? Because the lion’s share of most firms’ emissions — often 90% or more — lies beyond their own operations, primarily with suppliers and customers. The implications for management are stark, says Hoffman: “One company reducing its carbon footprint is all well and good. But to achieve net zero, the entire economy has to move.”

Again, such movement implies that companies looking to advance their climate commitments will likely need to engage their broader ecosystem — not only the immediate value chain partners responsible for emissions, but also strategic allies beyond it that can help shift the sector’s overall trajectory toward lower carbon intensity.

Following Hoffman’s logic, most companies opt to tackle their value chain impacts by focusing first on the highest emitters in their most immediate orbit, which is typically their large Tier 1 suppliers. Engaging this constituency is a challenge Schneider Electric — a global leader in energy technology — took on in 2021 with the launch of its Zero Carbon Project. The initiative is built around a series of digital tools, live events, and technical training for the firm’s top 1,000 strategic suppliers.

The process involved starting almost from scratch, says Vanessa Miler-Fels, the company’s senior VP of climate and environment. Some suppliers “didn’t even know what Scope 1 and 2 meant,” she notes. Even for those who did, few had ever sought to calculate them. Four years on, and their average emissions have dropped by 49%, well within reach of Schneider’s 50% target by the end of 2025.

So, how did Schneider achieve such buy-in? For Miler-Fels, the answer is a mix of “carrots and sticks.” To date, the company’s focus has fallen largely on the former. For instance, it helps suppliers arrange renewable power purchase agreements on a group basis, thus obtaining a cheaper tariff. It also assists suppliers in accessing renewable energy credits, which further reduces their energy bill.

“We’ve been fairly light on the stick so far, but it’s definitely something we’re considering going forward,” says Miler-Fels. “But you can’t wield a stick if you don’t build [supplier] capacity first, because otherwise you’re just cutting off your supply chain.

John Vernooij agrees. As managing director at Dutch waste management company Omrin, Vernooij helped oversee a joint recycling strategy between the firm’s local municipality customers and a number of the country’s large packaging companies.

The strategy, which combines advanced sorting technologies and AI-driven data management with eco-packaging innovations, helped Omrin create a vertically integrated waste-recovery system. Landfill and incineration rates are consequently now much lower, leading to a significant drop in overall emissions.

“Through this network partnership approach, we’ve helped scale regional circular economy initiatives from just six companies to over 160, including government, business, research institutes, and social organizations,” says Vernooij.

"Only with an accurate picture of its carbon footprint can a company pinpoint where it can make the greatest impact"

Step 3: Change your culture

To achieve net zero, responsibility can’t be siloed to the company’s environment department — it must be embedded in the day-to-day work of everyone across the organization. As with any shift in organizational culture, such change starts with education. To that end, leading companies roll out tailored training programs for all employees, explaining what they can do to help hit net zero targets in their specific function, be that procurement, finance, legal, or HR.

Essential to such training is ensuring a basic understanding of how sustainable performance is both defined and measured, says Eikelenboom. Every staff member should have a clear sense of “what level is good enough” and “what is required for us,” he adds. But, as Eikelenboom concedes, facts only get a company so far. Individuals also need to be incentivized to act. Performance reviews, promotion opportunities, and remuneration arrangements can all play an influential role. Include net zero targets in such areas, and the message quickly becomes clear: sustainability matters.

Even more compelling is when net zero strategies support employees’ growth targets and other core business metrics. The point circles back to Eikelenboom’s observation about carbon neutrality being a route to value creation, not just decarbonization. As he puts it: “You need to identify relevant business opportunities as early as possible because that’s when it starts to become attractive.”

Another part of making decarbonization attractive is public recognition. If a particular individual or team delivers a market-beating green product or engineers a super low-emission manufacturing process, companies should celebrate that success. Not only does such an approbation motivate those involved, but it also reinforces the broader message that net zero is a strategic priority.

“At the end of the day, net zero is not just a technical challenge — it’s a cultural one,” Eikelenboom states. “Achieving deep decarbonization requires a fundamental shift in how organizations think, behave, and reward performance.”

"To achieve net zero, responsibility can’t be siloed to the company’s environment department — it must be embedded in the day-to-day work of everyone across the organization"

STEP 4: Don't Wait for a Silver Bullet

A final word of warning. Given the long-term timeline for net zero, companies may be tempted to sit on their hands and wait for a breakthrough technology that cuts their emissions overnight. The message to such companies: don’t risk it.

While technical fixes will no doubt emerge in the coming years, the idea of a silver bullet decarbonizing global industry overnight is “wildly overoptimistic,” says Christopher Marquis, a specialist in strategy and international business at the University of Cambridge Judge Business School.

He points to cutting-edge geoengineering solutions — such as carbon capture and removal — as examples, noting that they require “huge amounts of energy” and are “very, very expensive.” Relying on a future breakthrough can also be perceived by the market as a form of delay. As he puts it: “It’s really easy to say, ‘Oh, we have this great technology, so you don’t need to be harassing us because this magical technical fix will fix everything.’”

Naturally, companies should seize big wins where they can be found. Yet, success with net zero ultimately lies in identifying priority areas for action and then tackling each in turn. Here, the balance between climate science and value creation is vital. So too is speed. Kickstarting the journey to net zero cannot wait. The scale of the challenge and the urgency of the problem demand decisive action. How companies choose to act today will determine how they and the climate fare tomorrow. If that sounds like an anomaly, then so be it: the world of climate commitments is full of them.

Key takeaways

Net zero success is a management challenge — not a motivation problem.
Map your carbon impact — target big wins and value creation.
Engage your ecosystem — most emissions sit beyond your walls.
Make net zero cultural — align incentives, training, and recognition.
Don’t wait for a “silver bullet” — identify and execute priorities for action now.