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The Climate Collaborative’s Tracking Progress 2022 Annual Report summarizes the results of the Tracking Progress Survey, an annual assessment of how companies have progressed on the climate action commitments they have made over the course of the previous year (2021). Our hope is that the information gathered and shared will help inform the work of the Collaborative and our broader community as we work together to find and activate solutions to the climate crisis. The Tracking Progress Survey also provides an opportunity to gain insight into broader industry trends specific to climate engagement.
With an interest in assessing barriers to climate action, this year's survey assessed how the pandemic and other macroeconomic trends are impacting progress on climate commitments. The pandemic, transportation related supply chain issues, labor shortages, and inflation remain high on the list of factors impacting climate action across all commitment areas.
Reporting companies cited limited resources, internal reorganization, and capacity constraints as barriers to action. Despite these factors and ongoing direct and indirect challenges related to the pandemic, our community is moving forward and making significant progress with 70% of reporting companies actively implementing climate commitments in comparison to the decrease seen in the previous year (63%).
In alignment with our broader strategy of supporting companies in integrating climate into all aspects of operations, this year's survey assessed the work that is happening inside organizations to operationalize climate. In the survey, 75% of respondents indicated that climate action is part of their overarching business strategy and 83% have taken steps to reduce emissions throughout their entire operations. In addition, 76% of respondents reported that they are prioritizing emissions reductions over offsets. The Climate Collaborative continues to encourage an “emissions reductions first” strategy, followed by the use of quality offsets.
As anticipated in last year’s report, an increasing number of companies are making net-zero commitments–28% of companies reported having set a net-zero target, a 3% increase from last year, and 37% of companies are considering it. This movement towards setting a north star goal reflects a broader industry trend of companies publicly promoting their long-term goals in marketing and promotional copy. We encourage all companies with long-term net-zero targets to support their targets with shorter-term goals. It is heartening to see that concurrent to an increase in net-zero targets, there is an increase in companies disclosing emissions.
At the time of this report, 761 companies have made more than 2,822 climate commitments through the Climate Collaborative. This year’s report reflects responses from 224 organizations (with 721 climate action commitments).
OPERATIONALIZING CLIMATE ACTION
The 2022 Tracking Progress Survey asked questions to help establish a baseline of the ways in which companies are currently integrating their climate goals into their overall operations. The results of the survey showed that half of the responding companies have trained more than 80% of their staff on climate commitments and 69% have made avenues available for all staff members to learn and engage in their climate work. 85% are taking climate into consideration when designing new products or offerings. Furthermore, 90% of companies said they have informed their board or other stakeholders about their climate commitments. 75% of reporting companies are engaged in climate advocacy.
Externally, 38% of companies are actively working with suppliers to decrease Scope 3 emissions which includes asking suppliers to transition to renewable energy (21%), asking to eliminate equipment that uses fossil fuels and transition to electric equipment where applicable (20%), asking to require or utilize low carbon farming practices (40%), and asking suppliers to reduce water use or set water reduction targets (32%). With just over 10% of all reporting companies engaging more than 80% of their suppliers in making climate commitments such as setting net-zero targets, making a commitment with the Climate Collaborative, or setting science-based targets, we see an opportunity to more intentionally engage suppliers in climate action to further build resilience throughout the supply chain.
Over the course of 2023, we plan to more fully integrate climate justice into all nine commitment areas to highlight that climate justice should be an integral aspect of climate action. At this time, 61% of responding companies are actively integrating climate justice into their climate work.
This year, 28% of respondents have set a net-zero target, a 3% increase from last year. Further, 37% of respondents said they are considering it. For those making an external commitment, companies reported making net-zero commitments with the following organizations: Science Based Target Initiative, Climate Pledge, Climate Neutral, SME Climate Hub, and Planet FWD Carbon Neutral. Of the 50 companies that have made an internal net-zero commitment, 50% have set a net-zero by 2030 target, and almost half have set short-term targets.
We anticipate that we will continue to see a rise in companies making net-zero commitments in the coming year. As such, we are continuing to develop programming that will support companies in fulfilling these commitments.
We asked companies which external reporting platforms they used for climate-related activities and emissions. According to survey respondents, B Lab is the top reporting platform among committed companies, with 50% of respondents reporting to B Lab (steady from 2020 and 2021), followed by 27% reporting through the SME Climate Hub and 23% through Climate Pledge.
Companies also referenced using Planet FWD Carbon Neutral, Climate Neutral, Science Based Targets Initiative, Net Zero Standard, CDP, SFTA at OTA, NCG Coefficient, CCOF, NOP, Regenerative Organic Certification, Climate Registry, GRI, Fair for Life, and RePurpose Global - plastic neutral, RSPO, Aclymate, SASB, Fairtrade International, and more.
PROGRESS ON CLIMATE COMMITMENTS
Overall, implementation progress across reporting Climate Collaborative companies this past year increased. On average, 70% of responding companies reported they are in the midst of implementing climate commitments this year, an increase from 63% last year. The remaining 30% of companies are either in active planning stages or have not yet determined how they will implement their commitments.
Survey results indicate that implementation progress across all but one commitment area is trending upward. Regenerative Agriculture had the largest increase with 76% of companies overall reporting progress, up from 58% last year. Companies report lack of financial resources, competing priorities, and reduced capacity to manage programs and producer relationships as barriers to greater implementation. Despite these challenges, of the 76% of companies reporting progress, 36% of companies report they have taken robust steps to implement Regenerative Agriculture and are seeing results compared to 21% last year.
This year, 56% of companies with an Energy Efficiency commitment reported progress on their commitment, up 4% from last year. Companies implementing a Transportation commitment reported a 5% increase in progress this year compared to last year, despite ongoing supply chain issues.
Specific to implementing reduction strategies in support of a Food Waste commitment, 35% report taking robust steps and are seeing results compared to 28% last year. Additionally, we continue to see growth in companies engaging in their Policy commitment.
For companies with a Forest commitment, 29% of companies have ensured their supply chains are free of deforestation and 41% of companies report engaging in reforestation efforts this past year. Companies experienced a 4% increase in implementing measures related to their Forest commitment.
Progress on implementing Short-Lived Climate Pollutants (SLCPs), such as HFCs, Methane and Black Carbon, increased marginally by 1% despite challenges associated with quantification in previous years. In the context of global supply chain shortages and cost increases, Packaging progress improved by 1% this year. Renewable Energy is the commitment area in which companies reported making the least progress, dropping 1% from last year. Several companies cited impacts of the pandemic, funding and local policy issues as barriers to starting or completing renewable energy projects. Furthermore, several companies cited the need to prioritize energy efficiency projects over renewable energy sourcing. We anticipate renewable energy to increase in the coming years due to the incentives from the Inflation Reduction Act.
43% of reporting companies are quantifying emissions reductions related to their climate commitments, an increase from 37% in 2021. We expect this increase is due in part to the number of companies operationalizing climate throughout their organization as well as the increase in the number of companies setting external net-zero targets. Emissions quantification may also increase as more measurement tools become readily available.
Progress in quantifying emissions reductions increased across all commitment areas as seen in the chart below.
Quantification progress was most advanced around Agriculture, followed by Food Waste, and Short-Lived Climate Pollutants (SLCPs) such as HFCs, Methane, Black Carbon. Renewable Energy, Energy Efficiency, and Transportation also experienced an increase in progress. Forests and Packaging commitment areas experienced the least amount of progress this year, although they are still reporting an increase in quantification overall from last year. Companies report quantification efforts in these areas were predominantly stalled due to financial resource constraints.
The Climate Collaborative staff and board look to the Tracking Progress Survey each year as a snapshot of what is emerging for our community. The data, both qualitative and quantitative, helps us understand new trends, potential barriers companies are facing, and tools and resources that are supporting company commitments. This information is used in concert with stakeholder conversations, engagement data, and an assessment of broader macroeconomic trends to inform our work. It is through listening to our community, talking to our stakeholders, and seeing how our Climate Collaborators engage with our resources that we can assess what is most needed.
At the time of this report, calendar year 2022 is almost complete, and there is still a good deal of turbulence in the economy even as we learn to co-exist with the implications of COVID-19. Therefore, it feels critical to underscore the importance of integrating climate action into every aspect of an organization’s work. This year’s survey was the first to ask several more operational questions, and it was encouraging to see the responses. A few highlights:
- Almost 85% of responding companies said they are considering climate when they design new products
- 75% of responding companies said they are engaged in climate advocacy
- Almost half of responding companies have trained more than 80% of their staff on their climate commitments
- 76% of respondents reported that they are prioritizing emissions reductions over offsets.
While these responses indicate a high-level of climate consideration in business operations, there is still so much work to be done. As we look to the coming year, we are eager to help companies lean more into engaging their suppliers in their climate commitments, continuing to quantify emissions, and supporting more pre-competitive collaboration.
The Climate Collaborative Team and Board are immensely grateful for the determination and commitment of the companies within our community that strive to create meaningful impact. We're honored to work alongside all of you in support of this critical work and look forward to celebrating progress in the coming years.
APPENDIX Tools & Resources
Tools and resources companies are using to support their climate commitments
GHG Protocol Tools
Date Check Pro
HFCS, METHANE, AND BLACK CARBON
EPA GHG Tool
EPA Emissions Calculator
Local utility RECs
Low Carbon Fuel Standard (CA)
Sub-sector within Industry
APPENDIX Analysis By Commitment