05 September 2023 - A new position paper by Corporate Leaders Group (CLG) Europe, convened by the University of Cambridge Institute for Sustainability Leadership, calls on the European Union to reduce its 2040 greenhouse gas emissions by at least 90%.
Read the position paper here.
The report asks the EU to set a net reduction target of at least 90%, compared to 1990 levels, to avoid passing irreversible tipping points. This should include no more than 8-10% coming from carbon removals.
CLG Europe members, from Coca Cola, Unilever and Salesforce, to Velux and Signify, are in support of this target. It follows a recent commitment by companies such as Coca Cola, Salesforce and GSK to reach net-zero emissions by 2040 under the Climate Pledge.
Ursula Woodburn, Director of Corporate Leaders Group Europe, said: "CLG Europe has been a longstanding proponent of setting ambitious climate targets to encourage businesses to decarbonise in a way that benefits the economy and society. The target we are now calling for of 'at least 90%' emissions reductions by 2040 is necessary, desirable and feasible. It will send a strong signal to speed up both decarbonisation efforts and the clean energy transition - and to increase the EU’s industrial competitiveness, including through the successful implementation of the Fit for 55 package by 2030.”
The target of at least 90% represents a level of ambition aligned with the Paris Agreement - to limit global warming to 1.5°C degrees. It is based on assessments conducted by the European Scientific Advisory Board on Climate Change (ESABCC), and modelling by organisations such as Climact and Agora Energiewende.
Tim Christophersen, Vice President of Climate Action, Salesforce said: “In setting a 2040 target, the EU can provide much needed leadership and give clear market and policy signals for climate action. We welcome a target that reflects the speed, urgency and benefits of near-term action, for people, the climate and nature.”
The report emphasises that this target is fit to reflect the urgency of the climate, nature and energy crises. It is adequate, science-based and will allow for steep emissions cuts over the next decade.
Lars Petersson, CEO of VELUX Group said: “To be ready for 2050, we need a 2040 EU emission reduction target of at least 90%. A significant part of this reduction needs to come from the building sector, which currently accounts for over a third of GHG emissions. At VELUX, by 2030, we aim to achieve a 100% reduction of operational emissions (scope 1 and 2) and reduce our carbon emissions from our value chain by 50% (scope 3). To get there, we collaborate closely with our whole value chain to create low carbon, energy efficient and healthy buildings.”
The 2040 target debate is an opportunity for the EU to send a clear signal to businesses that climate action will remain at the heart of the EU’s political agenda for the next two decades, according to the report. This will provide them with the predictability they need to invest early in the transition.
Examples in the report include switching to low carbon energy, decarbonising building stock and developing low carbon materials.
The report states that investment from businesses would have multiple knock-on benefits, from creating new jobs and generating economic growth, to improving health and well-being and advancing competitiveness.
However, more investment is still needed to decarbonise sectors where solutions are not yet available, such as heavy industry (especially cement), aviation and shipping.
Harry Verhaar, Chair of CLG Europe and VP Global Public & Government Affairs at Signify said: “A robust emissions reductions target of at least 90% emissions reductions by 2040 is critical to ensure that the EU sets the right course to arrive at its destination of climate neutrality by 2050. Businesses are already taking action to translate climate objectives into concrete action on the ground and are willing to accelerate their efforts. At Signify this means we have already achieved carbon neutrality by 2020 and are on track to go beyond carbon neutrality and double our positive impact on the environment and society by 2025.”
Finally, the report lays out 10 principles the EU needs to follow to reach the 2040 target:
- Accelerate electrification, energy efficiency and phase out fossil fuels
- Ensure that the costs and benefits of the transition are equitably distributed
- Embed the principle of competitive sustainability into the EU’s industrial strategy and climate policies
- Deploy all available levers to rapidly reduce emissions from the buildings sector
- Harness circular economy and eco-design solutions for environmental and climate benefits
- Harness the synergies between climate and nature objectives
- Adopt a realistic and evidence-based approach to carbon removals
- Significantly increase EU and national budgetary allocations for climate and nature
- Set a post 2030 climate and energy political framework building on the successful implementation of the Fit for 55 Package
- Be at the forefront of decarbonisation efforts globally
In order for at least a 90% reduction in emissions by 2040, there must be sufficient progress in the EU by 2030. Meeting the current 55% GHG reduction goal will be an essential pre-requisite, according to the report.
As the EU is currently not on track to achieve this target, urgent action is needed to accelerate large-scale deployment of existing low-carbon technologies.
According to the report, an ambitious 2040 target would indicate the EU’s intention to continue to lead internationally. A substantially lower target would demonstrate a lack of commitment and lead to the planet passing irreversible tipping points.
