High-growth companies have a major role in leading the Net Zero transition but need enabling conditions to do so, including supportive government policy and updated target setting standards, according to the Grow to Zero report from the Carbon Trust
Economic growth and business’s financial success don’t have to come at the expense of climate action - Grow to Zero calls for high-growth businesses to break the link between growth and rising emissions, a critical step to limiting global temperature rises to 1.5C. We must not lose focus on this, particularly given the mixed results of the most recent COP30.
The report outlines the business benefits of prioritising emissions reductions and seizing low carbon opportunities, including improved financial resilience, enhanced competitiveness, and in turn reinforced investor confidence. With this comes greater access to capital, through which high-growth companies can speed up the transition through deployment of new low-carbon assets. Early uptake of clean technologies like renewable energy and electric vehicles can markedly speed up their own Net Zero transitions while making these solutions more scalable and affordable. However, current methodologies do not account for the nature of asset replacement lifecycles, with many sectors undergoing step changes in technologies rather than continuous improvements.
The Science Based Target Initiative's (SBTi) latest draft of its flagship Corporate Net Zero Standard introduces asset decarbonisation targets, which is a key recommendation in Grow to Zero. These updates should allow companies to develop a plan to abate, replace and phase out applicable assets using a method that accounts for the nature of asset replacement cycles, echoing recommendations in the Grow to Zero report.
Grow to Zero also calls on target-setters to review their methodologies to support the rapid uptake of low-carbon technologies and energy systems needed to reach Net Zero. This is reflected in the updated draft of the SBTi’s Corporate Net Zero Standard, through the introduction of alignment targets. These should allow companies to meet targets by increasing their share of low-carbon activities rather than focusing on absolute emission reductions.
In addition, the Carbon Trust found that under the Sectoral Decarbonisation Approach companies growing faster than their sector average are expected to reduce emissions more quickly. This can lead to potentially unachievable targets for fast growing climate solutions providers within a specific sector, which may disincentivise them from target setting. For instance, a company scaling up production of low-carbon cement, a critical material for global decarbonisation, would need to follow a steeper carbon-reduction pathway than a slower-growing company producing standard cement, which does not contribute to broader decarbonisation efforts.
Therefore, while the updated SBTi standard offers more flexibility for all companies, clear pathways for climate solutions providers remain essential. The Carbon Trust will draw from its findings to contribute to the public consultation for the second draft of the SBTi standard, which is open until 12 December.
Claire Taylor, Technical Lead for Target Setting at the Carbon Trust, said:
“Low-carbon solutions providers and the widespread adoption of their technologies are critical to achieving the Net Zero transition.
“The SBTi has laid strong foundations through its Corporate Net Zero Standard, and with version two now out for public consultation, it’s encouraging to see standards evolving to incentivise alignment with low-carbon activities and support asset decarbonisation strategies.
“I hope these methodologies and pathways remain central in the final release of the Corporate Net Zero Standard V2.0.
“However, there is still a vital opportunity to define a clear roadmap that enables low-carbon solution providers to scale at the pace required for Net Zero.”
Notes to editors
Grow to Zero can be accessed on the Carbon Trust website
For further information please contact:
The Carbon Trust press office on +44 (0)20 7170 7050 or press@carbontrust.com.
About the Carbon Trust
The Carbon Trust is a global climate consultancy driven by the mission to accelerate the move to a decarbonised future. We have been climate pioneers for over 20 years, partnering with businesses, governments and financial institutions to drive positive climate action. From strategic planning and target setting to activation and communication - we turn ambition into impact. To date, our 400 experts have helped set 200+ science-based targets and guided 3,000+ organisations and cities across five continents on their route to Net Zero.
