Net-zero emissions targets are in crisis. Supply chains are increasingly impacted by extreme weather events causing ingredient prices to rise and budgets to be cut, and climate policies — once a motivating factor for decarbonization — are remaining stubbornly unclear. Even for companies with a steadfast commitment to carbon reduction, there are myriad challenges to decarbonization that take time and resources to solve.
Against that backdrop, some companies are indeed rolling back their net-zero targets. But others, according to PwC, are buckling down and getting smarter, more efficient, and more realistic in their approaches. Many companies set their 2030 targets without accurate emissions baselines or realistic means for achieving them. As the industry collectively matures in their approach to sustainability, an earnest and committed community of companies are starting to turn toward near-zero: not because they're abandoning net-zero, but because near-zero offers measurable, realistic guardrails in place of vague promises to "achieve net-zero by 20XX." It may look less ambitious on the surface, but the approach forces companies to substantiate their progress rather than lean on cheap carbon offsets to paper over the gap.
None of this should read as an admission of defeat. Challenges in reaching net-zero targets are, instead, an opportunity for businesses to re-evaluate what's realistic, identify avenues for meaningful progress, and drive emissions down as far as they credibly can — building toward long-term industry and environmental impact rather than a rushed and unsubstantiated finish line.
Near-zero vs. net-zero
Net-zero is ideal for businesses, amplified by regulatory pressures, investor expectations, and consumer demand, but transforming sustainability commitments into measurable results remains a challenge for many companies committed to environmental accountability, especially if the goal they’re working toward remains vague.
Net-zero targets are commitments from businesses to reach a state when greenhouse gas emissions and removals of a specific subject in a specific time period are fully balanced. As global warming intensifies, limiting impact is critical at this point in time to lessen the most severe consequences, as agreed upon by the 196 countries that signed the Paris Agreement. This is why setting any meaningful decarbonization target requires more than pledging to the concept – it requires robust guardrails to keep companies accountable, including alignment with science-based standards, capturing both direct and supply chain emissions, reducing reliance on offsets by prioritizing absolute emissions, phasing out fossil fuels and supporting just transitions, and independent verification to ensure credibility.
This is where near-zero comes in. Companies that have realized that net-zero targets may be more difficult to achieve than initially anticipated are rethinking their decarbonization approaches to better set themselves up for success toward net-zero targets. Near-zero targets require them to cut down emissions to the lowest realistic level, with stringent guardrails ensuring real operational change is happening, companies aren’t buying verified progress, and that they’ve made significant enough progress to neutralize remaining emissions.
Achieving near-zero emissions to accelerate toward net-zero
Ambition is admirable, but for some businesses and entire industries, it can be difficult to meet net-zero targets based on an externally provided timeline and vague long-term goals, whether they’re facing decarbonization hurdles or have scalability and pricing issues when it comes to implementing supplementary technologies. Near-zero emissions maintain ambition while providing more realistic targets for companies to work toward that are more feasible and ensure all measures have been taken to reduce physical reductions before net-zero.
The first step companies need to take is establishing their decarbonization baseline. This isn’t defined by a standardized model for all industries to follow. Companies must independently reevaluate their business model to identify where in their operations they can reduce direct emissions (Scopes 1 and 2). For food companies, that could look like electrifying gas-dependent equipment, upgrading cooling infrastructure, and shifting to renewable power.
The next step is to examine decarbonization opportunities in their supply chains (Scope 3 emissions). This is often the most challenging for companies as this accounts for indirect emissions, introducing hurdles when it comes to sustainability data maturity, quality, and access across suppliers and other third parties. By creating strong supplier engagement strategies that encourage collaboration, companies will be better able to access Scope 3 emissions data, establish an accurate baseline, understand which goals are feasible for suppliers as opposed to imposing targets, and accelerate progress with incentives and support.
Many companies cannot achieve net-zero without first prioritizing near-zero emissions. This should not be seen as an admission of defeat, but rather a realistic and hard-won strategy for meaningful reduction.
