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How to develop a net zero working culture

How to develop a net zero working culture

Thousands of companies now have net zero companies in place, but how can they ensure their employees, customers, and stakeholders are on board with the transition? Several leading firms offer their insights on how to build a net zero working culture

With thousands of companies and hundreds of investors boasting trillions of dollars of assets under management having set net zero emission goals in recent years, attention has swiftly turned to how to deliver on such ambitious decarbonisation targets. Much of the ensuing debate has focused on the technologies that companies will have to deploy, the innovations they will have to catalyse, the infrastructure they will have to upgrade, and the policies required to accelerate emission reduction efforts. But there is also a crucial human element at the heart of any successful net zero strategy: how can businesses convince their employees and stakeholders to get behind reforms that will require the organisation to transform itself inside and out? How can they build a net zero working culture?

For Gudrun Cartwright, environment director of charity Business in the Community, it is a fundamental challenge that all businesses are going to have to get to grips with. “It’s a transformational project over a scale we’ve never seen before,” she reflects. “So the starting point has to be senior leaders being really honest about what this means to them and asking: ‘Is my actual business model part of the problem or part of the solution?'”

Such honesty also needs to be matched by high levels of consistency in an organisation’s climate messaging. That means lobbying activities need to be in line with stated decarbonisation commitments and there has to be a coherent, credible, and properly funded plan for tackling emissions across the business over time. The board needs to be open about both the opportunities and the challenges associated with the transition to the net zero emissions. Not only does such honesty and consistency help maintain the company’s external reputation, but it also works internally to maximise the chances of the whole organisation being on board with the project.

“It’s about integrity,” argues Cartwright. “If you’re not embedding the risks and opportunities in your strategy, if you’re not governing what you’re doing at the highest level and people don’t feel like you’re putting enough resources and budgets to it, then that is a disconnected message you’re sending to employees.”

Once the overarching strategy is in place, communicating both what is going to change and why such changes are being made is critical. In short, there is huge value in treating employees as grown ups and giving them a degree of ownership over the strategy. Virgin Media O2 has set a goal of achieving net zero carbon operations by the end of 2025 and, as Tracey Herald, the company’s head of corporate responsibility and sustainability, admits some elements of the plan will have a direct impact on employees. “For example, transitioning to an electric fleet means changing the everyday tools field-based teams rely on,” she says. “But beyond this, we want to make sure everyone understands the role they can play in helping us get there.”

Setting a specific ‘society and environment’ objective for each department has also helped translate the overarching targets into concrete action at Virgin Media O2. For operations, for example, the objective might lead to a focus on transitioning the network to cleaner power sources or upgrading cooling technology to save energy in the company’s data centres. For marketing, meanwhile, the goal is more around driving customer awareness and take-up of greener products and services. “This [approach] creates clarity, purpose, and accountability across our business,” argues Herald.

Jennie Colville, head of sustainability at property development and management firm LandSec, agrees that achieving net zero emissions has to be a joint effort for its 500-plus direct employees.

Landsec has committed to reduce its absolute carbon emissions by 70 per cent by 2030 compared to a 2013/14 baseline, for property under its operational control. The target includes Scope 1 and 2 direct emissions, and a portion of Scope 3 value chain emissions from downstream leased assets.

The targets have been translated into a five-step net zero plan, in which it aims to reduce operational energy use, invest in renewables, use an internal shadow price of carbon, reduce its construction impacts and offset the remaining carbon. “That makes it super clear for everybody working with us or on our behalf on what steps we need to take,” says Colville.

She also stresses the critical importance of securing senior management ‘buy-in’ for the strategy. “I’ve been working in sustainability all my career and I’ve always maintained that more can be done when senior managers are engaged and being role models for sustainable living,” she says. “And that’s definitely happening more.”

Getting the C-suite on board can be achieved through simple, clear communication, she argues. “I always go back to the data,” she says. “Keep it simple, don’t get too technical, and then present the issue, present the options, and then what are the recommendations to take action?”

But there is also a need to tailor messages for your audience. “If it’s the chief financial officer that you’re speaking to, speak about money,” Colville advises. “If it’s your operations director, speak about how you can make sure that the building is more efficient. If it’s sales, speak about what tenants you can attract.”

Cartwright concurs that establishing a net zero working culture has to come from the top, singling out broadcaster Sky for its “brilliant engagement campaign” which started by briefing all senior leaders and getting them on board with the need for a bolder approach before then getting them to take that message out to the company’s various divisions.

However, board level support, while essential, is not sufficient on its own. Cartwright argues that in many organisations there is a way to go in engaging the full staff body right down to customer-facing, front-line roles. “The whole net zero climate action needs to run through the organisation like a stick of rock,” she says. “There’s very many senior leaders [that] are very committed and then you’ve got a brilliant cohort of sustainability professionals driving action, but how it weaves through the core strategy and the deliverables is not quite there yet.”

Cartwright reckons companies need to develop better ways of measuring success and engagement with all employees and then tracking performance. One possible mechanism for driving wider engagament is through internal reward systems. At Virgin Media O2, for example, carbon reduction objectives are explicitly linked to remuneration for the company’s executive committee.

Then there is a company’s wider supply chain. Colville admits promoting climate action across a company’s value chain can be challenging, but it is hugely important because 40 per cent of the carbon emissions for Landsec’s science-based target come from customers using energy within the buildings that it operates. “Yes, they’re not our employees but it’s a sphere of influence that we can work in,” she explains. “So a big piece of our work is around engaging with our customers about energy reduction.”

This engagement has to cover not just what people are being asked to do, but why they are being asked to do it. Colville says it is hugely important that employees are genuinely engaged because then “they understand what we’re trying to achieve… [And] that enables them to speak more fluently to customers, to supply chain partners. It’s around supplying the right data and providing the facts”.

Cartwright agrees it is vital to work collaboratively along the value chain. “A lot of our members are starting to work with their suppliers as part of their Scope 3 plans, and there’s a clear helping rather than punishing type of approach for most,” she says. “There’s a lot of peer learning for suppliers, so bringing people together on the same product categories and looking at how they can help each other.” As with most corporate transformation programmes, carrots tend to work more effectively than sticks.

But again, consistency is important, Cartwright stresses. “How do you make sure that your buying team are briefed, are having those targets within their remit, and therefore they are passing that down the line rather than just saying, ‘Well actually that’s all great but we just want the cheapest’?” she asks.

Beyond the use of discrete mechanisms to encourage engagement with an organisation’s net zero strategy, there is also a wider need to inspire employees and stakeholders that the changes that are on the way. Cartwright argues there is a lot companies can do to inspire employees to see the transition as an exciting opportunity.

Virgin Media O2’s internal communications have a regular sustainability theme, for example, and the company has a green group that around 1,000 employees have signed up to, which runs corporate events encouraging its 18,000-strong staff base to make green pledges. These pledges are then incentivised with offers such as discounts on home renewable energy tariffs or free tree saplings.

“Our goal is to make sure all our colleagues feel that they can do their bit – that they’re part of it, in and out of work,” explains says Herald. “And this is really about giving them different ways to engage and encouraging the keenest to become advocates who will inspire and make the changes with us.”

Herald says some employees have found the focus on sustainability has a knock-on effect in their private lives. “For example, giving our people access to carbon-cutting tech like electric vehicles at work might mean a slightly different way of doing their job, but it could also open the doors to greener tech at home,” she predicts.

Landsec has also been trying to encourage its employees to live more sustainably in their everyday lives. The company recently signed up to the Count Us In challenge, a UN-backed initiative taken up by many big firms to encourage individuals to take concrete but manageable steps to cut their carbon footprint such as walking and cycling more, reducing food waste, and ‘greening’ their money.

Colville says the challenge has sparked conversations within the organisation and, as people start to return to the office in the wake of the covid crisis, generated competition and “a little bit of a buzz”.

However, there are risks associated with any engagement campaign and there are limits to how much many organisations are willing to be seen to interfere in employee’s lives. When Landsec starts accounting for home working energy consumption, for example, it will probably use a proxy estimation methodology rather than asking for people’s energy bills “which could be considered a breach of privacy”, Colville admits.

But the general consensus is that net zero strategies tend to command high levels of support from employees, mirroring the large majorities of the public that support more ambitious climate action. Support is particularly high among the younger workers businesses are keen to attract and Colville argues that having clear sustainability values and acting on them can help with staff recruitment and retention. “Within interviews where I’ve been recruiting personally those questions are coming out: What’s the culture of the organisation? What is your response to climate change?” she says. “Future talent are using those criteria to assess whether they would like to work for the organisation.”

Research backs this up. Seventy-three percent of employees surveyed in the 2020 Edelman Trust Barometer said they expect a prospective employer to offer the opportunity to shape the future of society in a positive way.

A concerted effort to build a net zero working culture feels timely for multiple reasons. The imminent COP26 Climate Summit and this week sobering IPCC report on the scale of the climate crisis should make climate action more visible than ever before in the coming months. The government is poised to unveil a raft of new decarbonisation policies during the autumn. Meanwhile, the huge increase in homeworking during the pandemic has both shifted carbon emissions from direct corporate responsibility in offices to domestic settings, at the same time as raising thorny questions about working practices and the relationship between employees and employers – questions that are being further amplified by staff shortages in a number of crucial sectors.

Establishing a shared mission to accelerate the net zero transition alongside moreflexible working practices could help boost morale and foster a sense of corporate community at a time when many businesses are inevitably experiencing a sense of flux.

Moreover, flexible working can help to deliver direct emissions reductions. A report by Carbon Trust on The carbon savings potential of home working found wide variation in carbon emissions for home and office working depending on seasonal, regional and individual behaviour patterns. But, in most cases, offices generate higher carbon emissions than commuting; in Germany, for example, hybrid working could save up to 12.2Mt of CO2 emissions per year. More broadly, Cartwright says the pandemic has also brought business travel into the spotlight, raising questions about carbon emissions, relations with clients, and the extent to which companies should be competing rather than collaborating.

Ultimately, she argues, net zero requires a deep re-evaluation of how an organisation is run. “How do you make a culture that is thinking differently about our measures of success? What are the timescales we work on and what are we rewarded for? Is it just increasing sales, productivity or margins or is there more to it than that?” These are the questions a company with a net zero working culture is willing to wrestle with.

A company with a deep net zero culture will also have to be open to suggestions – and even criticism – from staff if it is not living up to its promises. “It’s not about any one company achieving net zero,” says Cartwight. “It’s about the world achieving net zero – so you have to be thinking about your part in the whole transition, not just your individual business.” The hope is that net zero working cultures can help catalyse the wider societal changes that can make deep decarbonisation possible.

Want to find out more about the net zero transition and how it will impact your business? Sign up now for a free pass to the Net Zero Festival and keep an eye out for upcoming details on this December’s Net Zero Culture Summit.

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