Shaken Not Burned

Highlighting changemakers and solutions

Glossary - Climate Transition Plan

A climate Transition Plan outlines the specific details of how a company (or a country) intends to transform its business in science-based alignment with the 1.5°C warming limit established by the Paris Agreement. A credible plan should include the entity’s asset base, operations, investments and business model – else it risks leaving out some serious material issues. Plans must also be time-bound, clearly laying out exactly when each action will be taken and the time horizon of its intended impact. Essentially, a Transition Plan is an important strategic document that will guide companies through today’s challenges by building resilience, adapting to change and implementing new strategies that create a sustainable future.

Busting a myth

“Food is only wasted on the consumer end of the value chain”

The term ‘food waste’ typically refers to that which is lost towards the consumer end of the value chain, such as leftovers tossed from the back of a fridge or the ‘wonky veg’ desperately offered by retailers. But all too often, the problem begins before food even leaves the farm gate. Generally distinguished as ‘food loss’ rather than waste, crops may be spoiled before harvest and goods may be ruined by lack of access to refrigeration. Inefficiencies throughout the agricultural system allow fresh produce to decline at every stage in its journey before it even comes close to supermarket shelves or household kitchens.

What we’ve been reading this week

• ‘Food waste’ has emerged as a critical issue, with UNEP now estimating that up to $1 trillion worth of produce is thrown away every year. By quantifying the economic impact of food waste, UNEP provides an understanding of the financial stakes, potentially prompting countries and companies to take it seriously.  The Food Waste Index Report 2024  says that a fifth of all food is wasted today, equating to around 1 billion meals that could otherwise feed the world’s most vulnerable. As Edie reports: “In 2022, global food waste reached 1.05 billion tonnes, including inedible parts, averaging 132 kilograms per capita and representing nearly 20% of all available food for consumers. Households accounted for 60% of this waste, followed by food services at 28% and retail at 12%. These figures exclude an additional 13% of the world’s food lost within the supply chain, as estimated by Food and Agriculture Organisation (FAO), which occurs between harvest and market.” 2023 saw UK ministers dump planned rules for mandatory supermarket waste reporting, which is a definite step in the wrong direction.
  

• Greenwash concerns continue to be an issue, especially within the fashion industry. In the UK, ASOS, Boohoo and Asda (of George at Asda) are all required to change the way they make and display their green claims following an investigation by the Competition and Markets Authority (CMA). The CMA says that it has signed formal agreements with the retailers to ensure they don’t engage in greenwashing terms. Each corporation has committed to specific actions and will be expected to report their performance. These measures include ensuring that all green claims are accurate and not misleading; conveying key information in a clear and prominent manner; replacing generic environmental phrases such as “eco” or “sustainable” with more specific terms such as “organic” or “recycled”; and avoiding the use of natural imagery to suggest a more environmentally friendly product. Furthermore, the CMA has issued an open letter to fashion retailers, asking them to work together to develop an effective standard of behaviour and best practice guidelines.
  

• Climate Action+ has published its net zero standard for assessing the actions of oil and gas companies, concluding that current transition plans aren’t strong enough to inform investors. It examined ten oil and gas companies and found that current disclosure is lacking in critical elements ranging from carbon capture to upstream production. The companies also took very different approaches, leading to discrepancies in the quality of disclosure between Europe and the US. It’s worth noting that a lot of investors have pulled out of the CA100+ recently, raising questions about the wider impact of US political pressure on ESG.

• Speaking of the ongoing attack on ESG, US investors have pulled $13.3 billion out of BlackRock’s funds. That includes last week’s announcement from the Texas Permanent School Fund that it intends to pull $8.5 billion by the end of April. The FT says this equates to around “one-tenth of 1%” of BlackRock’s overall assets, which today stand at around $10 trillion. Meanwhile the Mississippi Secretary of State has issued a cease and desist to BlackRock, accusing the asset manager of not being clear about its climate-related investment strategies. This followed Tennessee’s own suit earlier this year, either of which could see BlackRock banned from operating within the State. The backlash continues despite a recent study by Wharton, which showed that anti-ESG policies adopted in Texas drove up the cost of bond issuances to taxpayers by up to $500 million in less than a year. Ultimately, this is a political debate rather than a nuanced discussion of sensible investment strategies, highlighting the importance of this year’s elections.

• On a more positive note, climate accounting platform Persefoni has launched a free version of its reporting tool. This is useful for smaller businesses as, if they want to supply larger businesses, they’re going to be called on to provide necessary data on their goods and services. The current tool is focused largely on carbon emissions and not many of the wider ESG and sustainability issues, but it’s a great place to start for companies that are in the earliest steps of their reporting journey.