How to become a Net-Zero Company in Singapore?

How to become a Net-Zero Company in Singapore?

Countries around the world have started taking climate action. Singapore is one of the first countries in South East Asia to implement a carbon tax and to have a designed strategy for becoming a net-zero country by 2050. KPMG has ranked Singapore 15th out of 25 countries surveyed around the world for its net-zero readiness. Combating global warming and reducing carbon pollution are key strategic goals in Singapore’s future plan.

However, a recent study by Engie Impact, a sustainability solutions company found that 90% of companies based in Singapore lack the confidence and knowledge on how to decarbonise while maintaining their business financials. Companies require insights and support on strategies, approaches, and innovative solutions to guide them on achieving net-zero across their value chain. Among the large industries, Sembcorp Corporation for instance, has joined the Net Zero Alliance and has set a target to become a net-zero emission company by 2050, while increasing their ESG performance. Another notable company in Singapore is Dow Chemical, which incorporated a sustainable scheme to their current business practices and developed a business plan to reduce carbon footprint and waste by giving a second life to products such as shoe soles and transforming them into running tracks. They achieved this by quantifying their potential metrics, transforming their strategies and rethinking their business model in addition to assessing the financial impact it would have on their company. Dow chemical became the number one sustainable company in Singapore, and received a sustainability award from Business Intelligent Award for providing  sustainable alternatives. Thus, increasing their brand image and total revenues.

While some companies are making strides, there is a large percentage of Asian companies that have yet to understand and assess their sustainability status quo and benchmark it with standard sustainability best practices. To address these issues, a number of advisory companies have evolved. One such notable company is Singapore based pioneer company CorpStage, which is a sustainability enabler and helps companies in creating sustainable values. CorpStage assists companies to adopt sustainable business models and actions by providing a combination of advisory, platform, and benchmarking services. It provides a sustainable 360-degree report on the organisations’ sustainability performance accompanied by suggestions to ensure that companies achieve a long-term success. In other words, it assesses sustainability performance of companies and informs them to bridge their critical gaps and improve skills, and capabilities. CorpStage also provides net zero consulting services where it focuses on providing strategies to mitigate emissions, voluntary carbon credit generation and carbon offsetting.

Although sustainability is becoming a mainstream but companies still find it challenging as primary expectations of shareholders are financial returns. According to UOB’s chief sustainability officer Eric Lim –“If companies are ensured a financial benefit from becoming sustainable, their motivation will grow.” If new sustainable initiatives are implemented after quantifying potential financial and non-financial benefits then companies will maximise benefits of sustainability. Corpstage through its global experts from technical, finance and scientific background assists managers to prepare business cases for corporate sustainability and helps companies to identify their KPIs, quantify and monitor them to asses financial benefits across sustainable actions, and overall, reduce lack of confidence of corporate leaders in achieving their net zero targets. It not helps in coming up with strategies but also enables implementation.  

Net Zero commitments can be achieved if companies set their short term targets in addition to their long term commitment.  To achieve these targets, emission mitigation strategies need to adopted. Such strategies may require long term investment, research and development and innovation. In the short term to stay on track for achieving their goals companies can buy carbon offsets. While, buying carbon offsets is not a preferable climate action but it does count. By buying carbon offsets companies are effectively funding those projects which are doing good for environment and society. Therefore, it is an indirect good action.

Overall, decarbonisation of any company must be entirely integrated with the company’s strategy and governance in order to be both achievable and realistic. Many corporate boards have little knowledge on where and how to start. Board members have to more climate focused to advise companies to achieve their strategies. It is highly pivotal for the senior management to make themselves aware and learn how to transition their business models to achieve their sustainability without comprising financial returns.    

Let us all embrace net zero and contribute in making Singapore the promised green land for securing future for our next generations.

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