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Leading the Way to Net-Zero with Digitization

Table of Contents The net-zero challenge  How digital solutions create value  Building the business case for technology ­ How to ae software wor for your net-zero targets € inal words €‚

Chapter 1 The net-zero challenge

Carbon neutralityƒ a „oint at which there are net-zero carbon dio…ide †C‡€ˆ eissionsƒ is ore i„ortant than ever as co„aniesƒ “Šcientists broadly agree governents and organizations coe under that global net CO2 growing „ressure to i„rove environental eissions ust fall by at and sustainability outcoes in order to eet consuer and investor e…„ectations‰ least 45% from 2010 levels Šcientists broadly agree that global net C‡€ by 2030” eissions must fall by at least 45% from 2010 levels by 2030ƒ with only another € years to reach the goal of carbon neutralityƒ or net carbon zero‰ CO 2 This eans collectively we ust reove the sae aount of ‹H‹ eissions in the atos„here as huans generate to avert a „otential cliate disaster‰ 2 CO This is the underlying „rinci„le of the Paris Agreementƒ the first universalƒ legally-binding international treaty on global cliate changeƒ reŽuiring all states to “achieve a balance between anthro„ogenic eissions by sources CO and reovals by sins of greenhouse gases in 2 the second half of this century”‰

Figure 1: •a„idly changing drivers for change ” ears  ­“” t    er ne   o ­” olatilit ‚” €” dium Changes in EPS  Me ” 1st to 20th 20th to 40th 40th to 60th 60th to 80th 80th to 100th Percentile Percentile Percentile Percentile Percentile †Worstˆ †Bestˆ Oerall ES€ ‚anƒ „rom …orst to †est­ Šource– •efinitivƒ aceŠetƒ Bof— ˜Š ™Žuity š ›uant Štrategy

—do„ted by œ­ „arties at C‡ž€ on € Deceber € Ÿƒ the ground-breaing event “˜ntil C‡¤¥Dƒ cliate was an historic turning „oint and set out a change-related risks fraewor to liit global waring to well occied the to five of below €°Cƒ with the ai to liit the increase to ‰Ÿ°C‰ the world’s global econoic riss” Šignatory countries were reŽuired to subit their nationally deterined contributions †NDCsˆƒ or „lan for cliate actionƒ outlining how they would reduce their ‹H‹ eissions by €€‰ The C‡ž€­ suit in ‹lasgow in €€ „rovided a „latfor for „artici„ants to reset their sights on achieving net-zero and redouble their efforts‰ —lthough it is far too soon to assess the suit’s long-ter achieveentsƒ the drivers for change have ste„„ed u„ a gear‰ —s ™a —rnoldƒ Technical Directorƒ Šustainability š ™HŠ —dvisory at —rcadis notes– “˜ntil C‡¤¥Dƒ cliate change-related riss occu„ied the to„ five of the world’s global econoic riss‰ ¥ndeedƒ failure to act on

cliate change too the to„ s„ot in the lobal isks eort „ublished in ¦anuary €€ by the World ™conoic oru‰” “Blac•oc disclosed that ¥„ortantlyƒ global investors who use the CDž in the „ast year it had voted data to assess the environentalƒ social and 55 times against directors governance †™Š‹ˆ „erforance of co„anies at 4 comanies who had when they ae investent decisionsƒ have failed to ae „rogress on ade a seisic ove on this issue‰ tacling the climate crisis” or e…a„leƒ in Še„teber €€ƒ the world’s largest asset owner lackock disclosed that in the „ast year it had voted ŸŸ ties against directors at ‚œ co„anies who had failed to ae „rogress on tacling the cliate crisis‰ That sae onthƒ the CDž „ublished the Foundations for Science-based net- zero taret settin in te cororate sector reortƒ on behalf of the Šcience Based Targets ¥nitiative †ŠBTiˆƒ which “obilizes co„anies to set science-based targets and boost their co„etitive advantage in the transition to the low-carbon econoy”‰

‡n €“ ‡ctober €€ ƒ the SBi launced te first science-based frameork for “©ore than 00 co„anies comanies to set net-zero tarets – the globally have signed the Net-Zero Štandard¨ it intends to ensure ŠBTi’s Business Ambition co„anies’ net-zero targets translate into action‰ ©ore than œ co„anies globally for 1­5°‚ commitment” have signed the ŠBTi’s Business —bition for ‰Ÿ°C coitent‰ Šustainability sits beside broader environental co„liance obligations covering airƒ soilƒ water and wasteƒ all „arts of the net-zero ªourney‰ ™ach has its own re„orting reŽuireentsƒ adding another layer to the co„le…ity of environental and sustainability data that co„anies aggregate fro their e…tensive cor„orate foot„rints‰ This is where enter„rise-wide software solutions coe in‰ Through the delivery of accurateƒ real-tie data collectionƒ software „rovides co„anies with full visibility of their o„erational „erforance and „uts actionable insights into the hands of every e„loyee‰

or e…ternal staeholdersƒ it also deonstrates assurance by „roviding ore reliableƒ auditable data for ‹H‹ anageent “Through the delivery of re„orting‰ —ll of this frees u„ valuable accrateƒ real-time data resources and enables decision-aers collectionƒ soft…are to focus on the end goal – a„„ing and e…ecuting their road to net-zero‰ „rovides co„anies with full visibility of their o„erational „erforance and „uts actionable insights into the hands of every emloyee”

Chapter 2 How digital solutions create value

™nter„rise-wide software creates incredible value because it enables co„anies to identify their greatest environental i„acts and develo„ etrics to set goals and easure „rogress in reducing greenhouse gas †‹H‹ˆ eissions‰ ¥ntegral to decision-aingƒ ris anageentƒ disclosures and re„ortingƒ software can significantly i„rove cor„orate and sustainability „erforance‰ Here’s why‰ Large co„anies run ulti„le sites located in any different geogra„hical territoriesƒ each with their own regulatory reŽuireents and re„orting systes‰ or these o„erationsƒ anually aggregating vast reas of carbon anageent and sustainability data fro gigantic cor„orate foot„rints is costlyƒ both resource and tiewise‰ To start withƒ software aes it far easier to „erfor co„le… calculationsƒ „roviding ore accurate and tiely analysis of critical dataƒ which is essential for the growing deands of sustainability re„orting‰

Future‡proofing “Šoftware aes it far Co„anies need to res„ond to a growing easier to erform comle† body of cliate-related laws and „olicies and calclationsƒ roviding failure to co„ly riss legal action and „unitive fines‰ more accrate and timely analysis of critical dataƒ —s cliatic-related incidents becoe ore which is essential for freŽuent and doinate news headlinesƒ „ressure to redouble efforts on ‹H‹ the growing deands of eissions can only intensify‰ Co„anies sustainability re„orting” should therefore antici„ate additionalƒ tougher regulations in the future‰ The advantage of ado„ting a software as a service †ŠaaŠˆ-based sustainability solution now is two-fold‰ irstƒ it enables co„anies to eet e…isting sustainability goals and secondƒ it hel„s the to future „roof‰ ¥n doing thisƒ they will be better „ositioned to res„ond effectively when challenges arise further down the road‰ — solution using a ŠaaŠ odel can be easily and Žuicly u„dated as organizations continue to res„ond to aret and organizational shifts‰ Consuersƒ investors and regulators all

e…„ect co„anies to „rove they are aing significant „rogress on reducing their carbon foot„rint‰ “•ather than sending out — co„any that can deonstrate countless inforation uneŽuivocally that its sustainability reŽuests and waiting for „erforance goes above and beyond current the res„onsesƒ soft…are reŽuireents will be „ositioned as a aret rovides visibility into an leader¨ „roviding assurance to third „arties individal site or location” that the business has „ut decisive action behind its words‰ People po…er ¥ntegrated environental health and safety †™HŠˆ software aes data „rocessing anageent sealessƒ significantly reducing worloads and freeing u„ staff tie to focus on the ost high-value tass‰ or instanceƒ the highest-„erforing sites can be identified and „rooted as best „ractice¨ the lessons learned can be a„„lied to sites where „erforance needs to i„rove‰ •ather than sending out countless inforation reŽuests and waiting for the res„onsesƒ

software „rovides visibility into an individual site or locationƒ so the sustainability “ˆore accrateƒ real-time „rofessional can identify who has and data and the assurance this hasn’t res„onded to reŽuests iediately‰ „rovides will demonstrate This saves tie waiting for data to be returned anually via eail and eans the a real commitment to sustainability „rofessional can focus efforts on an organization’s net-zero s„ecific sites that are not res„onding‰ as„iration” ‰rand leaders Digital solutions are critical to brand „erce„tion‰ ©ore accurateƒ real-tie data and the assurance this „rovides will deonstrate a real coitent to an organization’s net-zero as„iration‰ This atters not only to investors and other ey e…ternal staeholdersƒ but also an internal audience that loos u„ to senior anageent and e…„ects strong leadershi„ on cliate-related issues‰ Consuers care about the „lanet’s future and co„anies that can deonstrate how their actions on cliate-related issues atch e…„ectations will benefit fro their s„ending decisions‰ is is reflected in a survey of

lobal consumers ublised by ­ielsen in 201€‰ “‰1% of resondents felt ¥t found that “ ” of res„ondents felt strongly strongly that co„anies that co„anies should hel„ i„rove the should hel imrove the environent‰ The overriding essage was uneŽuivocal– consuers are using their environment s„ending „ower to effect the change they want to see‰ They are even „re„ared to „ay ore if they now it is a sustainable o„tion‰ ¥t is also i„ortant to challenge the is„erce„tion that sustainability only adds costs to a business‰ ¥n factƒ taing the right a„„roach to carbon anageent and sustainability can o„en u„ new revenue streasƒ boosting „rofits and increasing savings‰ .

Chapter Š Building the business case for technology

©ost co„anies have either develo„ed a carbon anageent strategy to reduce their greenhouse gas †‹H‹ˆ eissions or are “— coon istae that looing to i„leent one in the future‰ They co„anies ae when will also be considering how they can anage i„leenting a software residual carbon to ensure they achieve their net carbon zero abitions‰ solution is that they don’t To do both successfullyƒ they need to reare roerly for the be confident that the carbon eissions digital transition” and sustainability data they hold can be aggregated effectively and „rovides an accurate reflection of their current o„erational foot„rint‰ — coon istae that co„anies ae when i„leenting a software solution is that they don’t „re„are „ro„erly for the digital transition‰ ‡ftenƒ there is a rush to get the „latfor u„ and running without carefully considering what ste„s are needed to ensure it is a resounding success‰ The reŽuireents will vary fro „roªect to „roªect but building an effective business case is the first i„ortant ste„ in the digital transforation ªourney‰

— good starting „oint is to develo„ an integrated carbon iniisation ethodology outlining all of the o„erational activities that “Co„anies will have a generate C‡€ eissionsƒ such as energy clearer „icture of their usage and trans„ortationƒ the su„„ly chain’s current carbon anageent role and organizational factors such as staff travel‰ and sustainability ‡nce co„letedƒ co„anies will have „erforance and …hat a clearer „icture of their current carbon the riorities are going anageent and sustainability „erforance for…ard” and what the „riorities are going forward‰ They can also identify the cliate change i„acts that they are ost vulnerable to‰ This „rocessƒ howeverƒ reŽuires end-to-end and cross- functional collaboration and transforation across the entire business‰ When the business case is „ut forward it ust be co„rehensive in detail and directors need to a„„rove it early on‰ ailure to do this can lead to i„leentation delaysƒ which could i„act on the co„any’s deadline for ‹H‹ anageent re„orting to third „arties‰ Delays can also add business costs and „lace „ressure on all of the staeholders involved in

the software’s delivery‰ ere are tree key considerations‚ › ©ae sure the digital strategy „ro„osed aligns with the co„any’s cor„orate and carbon strategies‰ The s„onsor financing the software i„leentation ust be confident that it fits into the overall cor„orate obªectives as this under„ins sustainable growth‰ › Clearly deonstrate the o„erational benefits the software solution can offer u„frontƒ ost significantly its return on investent‰ These include reduced energy costsƒ the autoation of tie-consuing anual tass and the delivery of ore accurateƒ real-tie data to infor decision aingƒ ris anageentƒ disclosures and re„orting‰ › ©ae sure the software „ositions the co„any so it can res„ond effectively to future eventsƒ including the introduction of tougher regulations or changes in re„orting fraewors‰

Chapter 4 How to ae software wor for your net-zero targets

™very co„any will have its own carbon reduction abitions as well as differentƒ and soeties co„etingƒ deadlines for “A nified latform can achieving sustainability targets‰ integrate data sets Whether it is iniising the i„act of staff effortlessly and „ull all travel on your carbon foot„rintƒ slashing of this critical inforation energy consu„tion across your building together” stoc or identifying o„„ortunities to reduce waste volues through recycling ore aterials – creating new revenue streas and boosting „rofits in the „rocess – software is an i„ortant enabler‰ Large co„anies o„erating sites across different geogra„hical locations will often have to co„ly with a yriad of regulatory and re„orting reŽuireents yet ay still rely on anual data entry „rocessesƒ in„utting data fro ulti„le data ca„ture systes‰ — unified „latforƒ howeverƒ can integrate data sets effortlessly and „ull all of this critical inforation togetherƒ either eliinating the tie consuing „rocess of anual entries entirely or reducing your worload significantly‰

©ore cost-effective and efficientƒ ™HŠ a „articular site‰ —red with this actionable software will also „resent a far ore accurate dataƒ you can redirect waste aterial into „icture of your o„erational „erforance in recycling and grow the business through real-tie‰ Collecting data sealessly through creating new revenue streas‰ The ability a single sourceƒ software aes actionable to ca„ture real-tie data eans you will be data available fro a central location for a far ore nible in your a„„roachƒ able to wide range of end usesƒ such as re„ortsƒ tae decisive action and better „ositioned to disclosures and internal dashboards‰ accurately re„ort how your carbon foot„rint has been reduced‰ Šoftware also offers an essential visualization ca„ability so you have e…cellent oversight ¥„ortantlyƒ software also allows e…ternal of your in„uts and calculations across the auditors to access re„orting dataƒ so they business’ entire o„erational foot„rint‰ ull can review your targets and verify your data is visibility eans you can drill down to see accurate for e…ternal staeholders‰ eissions on a s„ecific site or country basisƒ which is i„ortant for forecasting future The solution can deonstrate the calculation success‰ ethodology for co„liance „rograsƒ including sustainability and greenhouse gas or instanceƒ you can build annual C‡€ †‹H‹ˆ‰ This is i„ortant because it „rovides reduction targets into the software’s internal an additional level of auditability and also dashboard and calculate onthlyƒ Žuarterly deonstrates the validity of your final carbon or si…-onthly re„orts to see how you are eissions nubers‰ „rogressing‰ “or soe industriesƒ such as utilitiesƒ oil ¯ou can also set ore short-ter targetsƒ and gasƒ anufacturing and iningƒ if you for e…a„leƒ onitoring waste volues at have heavy reŽuireents for environental

re„orting around air eissionsƒ wasteƒ water effluents and cheical releasesƒ as well as those voluntary sustainability re„ortsƒ using “irstƒ there is the efficiency a unified „latfor to anage all of those angle because you aren’t different „rogras will offer ey benefitsƒ” says doing double wor on data Christine Wyan ©cCartyƒ žroduct ©areting ©anager at Cority‰ entry or trouble shooting “irstƒ there is the efficiency angle because using data in ulti„le you aren’t doing double wor on data entry or „laces‰ Šecondƒ a nified trouble shooting using data in ulti„le „laces‰ latform hels …ith data Šecondƒ a unified „latfor hel„s with data integrity and consistency­” integrity and consistency‰” Christine ‹man McCart žroduct ©areting ©anager at Cority

inal Thoughts —s e…tree weather events becoe ever Net-zero will only be achieved by reducing ore freŽuentƒ disru„ting su„„ly chainsƒ carbon eissions and actively reoving „utting assets at ris and threatening business greenhouse gases fro the atos„here continuityƒ governents are liely to i„ose in tande‰ —n ™HŠ software „latfor increasingly tougher easures on co„anies that „rovides full trans„arency of carbon to incentivize the to ‘u„ their gae’ on anageent „erforance and ars the carbon reduction‰ —dditional international and sustainability „rofessional with accurateƒ national regulations should also be e…„ected actionable data to res„ond effectively to the ¥ntroducing Cority‡ne™ƒ the and ore „unitive fines for failing to co„ly‰ cliate challenge can be a gae changer‰ ost co„rehensiveƒ huan- centered ŠaaŠ „latfor—designed or those co„anies that have the foresight to Šustainability software „rovides co„anies by ™HŠ e…„erts for ™HŠ e…„erts and business leaders‰ ‡ur global ebrace change and realize that taing with a way to ore effectively anage and enter„rise „latfor unites the full „roactive ste„s now will avoid costly reduce their carbon eissionsƒ identify s„ectru of „owerful solutions to itigation easures later onƒ there is also a actions that result in costs savings and higher e„ower healthierƒ saferƒ sarterƒ and ore sustainable outcoes that great o„„ortunity to develo„ new revenue „rofitsƒ enhance brand „erce„tion and deliver fulfill today’s business i„erative— streasƒ boosting „rofits and attracting co„etitive advantage‰ creating a better enter„rise for toorrow‰ investent at a tie when co„etition for resources becoes ever ore intense

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