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Corporate America Is Committing To Carbon Cuts Through Science-Based Targets

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Kellogg Company is on a mission to increase its share of world markets while also keeping its greenhouse gas emissions in check. And the cereal maker says that it will use science-based targets that are accredited and verified by third parties.

Sustainability is becoming increasingly ingrained in corporate cultures -- an evolution that will live on regardless of public policies. It's really one tied to the free market and designed to meet the needs of consumers who are environmentally conscious. The challenge now, though, is to separate the hype from the hope -- the ability to quantify results. To that end, science-based targets aim to keep global temperature increases below 2°C compared to preindustrial levels. 

“It changes from what can you do to what must you do. It says that science is telling us this is what we must do,” Erin Augustine, senior sustainability for Kellogg, told an Environmental Leader audience."We are 100% committed. Let’s get after it.”

Set in 2009, the company says that it will reduce its greenhouse gases by 15%-20% by 2020. By 2050, it will reduce those same releases by 65% within its four walls and across its supply chain by 50%. In the short term, it will mean more energy efficiency. Over time, it will mean using more low-carbon fuels such as biomass and solar and low-carbon technologies like fuel cells.

The Science Based Targets initiative is a collaboration between the CDP, the UN Global Compact, World Resources Institute and World Wildlife Fund that not only sets targets for specific companies and industries but also works to verify them. Several hundred companies have committed to using such standards and include Xerox Corp., Wal-Mart Stores and Dell Technologies. 

Corporate missions have evolved and have a more extensive scope. That change is occurring because activists, regulators and investors have united to make companies live up to higher standards. By creating goodwill among all of their stakeholders, those enterprises are building a “brand” -- an image of who they are and how they will be viewed. Customers, in fact, seek out companies that go green. 

Consider Marriott International, which is the largest hotel chain in the world: Central to its business strategy is to attract large conferences, whose sponsors are demanding that their hosts have a proven track record of limiting greenhouse gases and being environmentally friendly.

The company embeds climate into its goals and looks foremost at science-based targets. As such, its approach on climate change is manifesting itself on the bottom line. For example, major conferences may send out a “request for proposal” that seeks to know exactly the tack a hotel uses to address climate change and water shortages. If a particular hotel is unable to account for such things, it will get passed over.

“Customers will tell us they didn’t pick us because they didn’t have visibility into our standards,” says Denise Naguid, vice president of sustainability at Marriott International told Environmental Leader. “There is high risk if we don’t do certain things. We would lose certain business.”

Meantime, Owens Corning also uses science-based targets and it has changed its greenhouse gas goals from a 20% improvement to a 50% improvement. To get there, it is pricing carbon — at an internal price of anywhere between $10 and $40 a ton. The move pushed it, for example, to purchase two wind farms that produce 250 megawatts and that service 60% of the company’s U.S. electric demand. 

“The transparency is important and then reporting regularly on the progress," says Doug Pontsler, vice president of sustainability at Owens Corning told Environmental Leader. “The more transparent we are, the more our investors can make the judgement based on how important it is to them." 

The common thread running through the corporate community is that the pursuit to become increasingly sustainable and carbon friendly is driven foremost by markets and the eventual effect on the bottom line. A change in federal leadership has little to no impact on those strategies. Indeed, at least 1,200 governors, mayors, businesses, investors and colleges in the United States have declared their intent to live up to the standards created by the current global climate protocol.

Research by Lucid and Urjanet indicates that 73% of companies expect their commitment to carbon reductions and sustainability to be the same while 21% plan to increase their involvement. Only 7.7% say that they will decrease their commitment.

“Our constituencies have not changed,” notes Marriott's Naguid. “Our guests still have expectations and they will not make a change because of the situation in Washington. There is a heightened focus on this and business needs to step in and step up.”