The decarbonization of companies highlights numerous environmental, social, and economic challenges. Understanding their carbon footprint allows companies to implement action plans to reduce greenhouse gas (GHG) emissions. At the same time, this approach offers significant strategic and financial opportunities.
However, many organizations struggle to initiate this process and remain unaware of the advantages it can bring.
Corporate decarbonization: what is it?
The term decarbonization includes all the measures and techniques that enable a company to develop an action plan aimed at reducing its carbon footprint and mitigating its environmental impact, particularly the GHG emissions generated by its activities.
This process involves rethinking how companies interact with the environment. Embedded within these measures are numerous challenges that drive both internal and external objectives for organizations embarking on this journey.
The challenges and objectives of decarbonization
A decarbonization approach often begins with the completion of a carbon audit, which provides organizations with critical insights into their GHG emissions and highlights areas for improvement. This initial step is fundamental to any decarbonization strategy, as it identifies priority actions and outlines a clear decarbonization trajectory.
In a context where action on consumption is imperative, the decarbonization of high-impact players, such as companies, is a vital measure. Corporate activities directly contribute to significant GHG emissions, underscoring the importance of this approach. In France, the industrial and transport sectors alone accounted for 50% of polluting emissions in 2023. Consequently, organizations must focus their efforts on strategies aimed at improving energy efficiency and promoting energy sobriety. These strategies encompass decisions about raw materials, energy sources, production methods, procurement practices, and even the daily commuting habits of employees.
Decarbonization through carbon reduction encompasses several interconnected objectives that drive progress toward carbon neutrality:
- Facilitate and accelerate the ecological transition by fostering the adoption of innovative and efficient technologies, as well as scaling up existing solutions. This leads to the creation of sustainable jobs, improved quality of life, and environmental preservation, all while maintaining economic growth.
- Move towards a green reindustrialization by promoting initiatives that generate employment in high-growth, low-environmental-impact sectors such as renewable energy, waste management, and sustainable mobility.
- Reduce dependence on fossil fuels by transitioning to clean and renewable energy sources, including solar, geothermal, and hydroelectric power.
Beyond its environmental objectives, this approach can also serve as a lever for achieving strategic business goals.
A source of benefits for companies
Adopting this approach allows companies to comply with legislation and prepare for upcoming regulatory requirements regarding GHG emissions. Beyond compliance, it offers the opportunity to address multiple needs and unlock significant benefits:
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Economic benefits:
Enhances competitiveness and reduces costs through improved energy efficiency while mitigating the impact of fossil fuel price volatility on product pricing. It also provides a competitive edge by investing in innovative, high-performance decarbonization technologies that anticipate market trends.
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Reputational benefits:
Externally, it allows the company to meet the expectations and demands of consumers and investors who are sensitive to environmental and social criteria. Internally, it builds employee trust and reinforces alignment with the company’s values.
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Environmental benefits:
Ensures compliance with existing regulations and strengthens energy security by reducing reliance on fossil fuels. Additionally, it contributes to the fight against climate change and supports the company’s CSR strategy by achieving its environmental objectives.
Implementing a decarbonization approach can also be driven by a company’s culture and principles, independent of direct economic gains. Regardless of motivation, its integration into the corporate strategy remains consistent and impactful.
How to implement this approach?
Implementing a decarbonization approach requires the development of a well-structured and strategic plan. This plan will guide the organization in setting objectives and leveraging all available resources to facilitate the transition.
1. Conduct a baseline assessment
To understand their environmental impact and raise team awareness about major sources of GHG emissions, as well as energy and climate vulnerabilities, companies can conduct a carbon audit. This process helps outline short-, medium-, and long-term goals while identifying areas for improvement.
In France, the Carbon Audit method initiated by ADEME and supported by the Association Bas Carbone (ABC) facilitates the creation of a BEGES, a mandatory emissions report for companies with over 500 employees and local authorities.
2. Develop a decarbonization strategy
Building on the audit results, companies must identify actionable levers to create an effective decarbonization plan. Key areas include:
- Energy efficiency: reducing energy needs while maintaining performance by optimizing resources, limiting waste, and using efficient machinery or systems.
- Energy sobriety: minimizing overall consumption by optimizing processes, reducing waste, and fostering team awareness.
- Responsible IT purchasing practices: extending the lifecycle of IT equipment through refurbishment, leasing, and sustainable procurement practices.
To further advance decarbonization, companies can switch to renewable energy, adopt decarbonized mobility plans, and integrate energy recovery systems, such as heat recovery, to reduce indirect emissions.
3. Take action
With a clear plan in place, companies can focus on implementation using various resources and support mechanisms:
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The government's roadmap supported by the National Low Carbon Strategy, initiated in 2015 and updated in 2019, offers guidelines for transitioning to a low-carbon economy.
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Financial aid from the France 2030 Plan supports industrial decarbonization projects.
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Significant State investments in decarbonizing industrial sites:
- €5.6 billion for industrial decarbonization.
- €5 billion in direct aid for deploying decarbonization solutions.
- €610 million for innovation and low-carbon technology development.
What about digital decarbonization ?
Given the increasing reliance on digital technologies, adopting a Green IT approach is critical. The digital sector accounts for 4% of global GHG emissions, making it a vital component of a company’s carbon footprint.
A Green IT strategy includes actions such as refurbishing IT equipment, optimizing procurement, and raising team awareness. Practical steps include prioritizing refurbished and second-hand devices and managing data storage to retain only essential information.
The Fruggr solution acts as a digital decarbonization ally. This SaaS tool simplifies CSR data management, enabling companies to achieve their non-financial goals. After evaluating various criteria, Fruggr provides tailored recommendations to activate impactful improvement levers while offering a comprehensive view of progress.
Decarbonization is a cornerstone of the ecological transition. Beyond regulatory compliance, it presents strategic opportunities for companies, including cost reduction, enhanced competitiveness, and improved reputation. By combining concrete actions with long-term commitment, decarbonization is not only a key to reducing GHG emissions but also a pathway to continuous improvement and sustainability.