Emissions - the greatest challenge for the planet and for reporting

Rising greenhouse gas emissions and the anthropogenic climate change caused by them are currently one of the most serious challenges faced by companies and organisations around the world, both the largest and the very small ones. In order to reduce them, not only urgent but also well-considered action is needed to have a concrete effect. This, in turn, requires a sound calculation and analysis of the carbon footprint along the entire value chain. Neither task, however, is an easy one.

There is no doubt that greenhouse gas emissions have a global warming effect and influence climate change[1]. Their consequences are not only catastrophic weather phenomena, but also a reduction in biodiversity or humanitarian crises that affect various areas of the world. Thus, they are a threat to societies and the health of the global economy.

The private sector, given its share of global emissions, faces a huge challenge in decarbonisation, i.e. the transformation towards low- or zero-carbon operations. The starting point for this process is the calculation of the carbon footprint and setting ambitious reduction targets, which takes on particular importance in the context of the mandatory reporting of this data as part of sustainable development in accordance with the new EU directive. Both companies with extensive experience and established solutions and those that are just at the beginning of their journey face this task. This is because it is difficult to describe and then reduce emissions that have not been accurately calculated across the entire value chain.

One Group, three scopes

Emissions are divided into three scopes. The first covers direct emissions from the combustion of fossil fuels from the organisation's sources, from technological processes or refrigerants. The second are emissions related to electricity and heat, steam, etc. The third - the most complex one- combines the remaining emissions from the entire value chain located on the supply side and on the product side.

For Raben Group, the first scope covers emissions resulting from the combustion of fuels by its own fleet. Our diesel-powered fleet generates a carbon footprint, which we calculate using internal tools in line with global standards and report on the basis of actual data (amount of fuel consumed). Scope two is primarily electricity and heat required to maintain the warehouses and office buildings. This area is also very well mapped. For the most part, the actual data is provided by the energy suppliers, which makes it possible to calculate the carbon footprint accurately and reliably. This allows us to work on the efficiency of this parameter ourselves, e.g. by reducing consumption or reducing emissions through the use of renewable energy. The third scope primarily includes our subcontractors - more than 2,000 entities, mostly small and medium-sized companies, which provide logistics services for us. In addition, we report emissions related to other transport activities: air, sea, rail, business travel or employee commuting.

For the calculation of scope three emissions from transport activities, we have developed an internal carbon footprint calculation tool based on the international GLEC standard and linked to our transport system (TMS). With shipments planned and all vehicles, including those of subcontractors, entered into the system, we are able to determine emissions with a very high degree of accuracy on the basis of actual geographical data. This allows us to present emissions at a single route and a shipment level.

More and less involved business

It may seem that, since we have been producing reports for almost a decade, we have collected the necessary data ourselves and we do not need to rely on subcontractors for this, describing emissions along the entire value chain is already a mere formality. However, the issue is more complex. In 2022, we adopted new science-based CO₂ reduction targets which are in line with the Paris Agreement, and which were approved by SBTi. Accordingly, we aim to reduce emissions by 38.7 per cent in scope one and two by 2030 (compared to 2020). We have already been quite successful in this area with emission reductions exceeding 26% last year. In addition, we have committed that within five years we will engage 77% of our carriers to start measuring their emissions and set their own reduction targets. This is a major challenge given that these companies are unlikely to have the experience or resources to calculate emissions, even if they do have the relevant data. They may also lack motivation because, due to their size, they will not be subject to reporting obligations. Since it is our shared responsibility, we have decided to support our carriers in both calculating their carbon footprint and finding a way to reduce emissions.

Here it is worth noting that the mentioned SBTi targets are increasingly prevalent in the business sphere. The Science Based Targets initiative currently brings together 6255 companies worldwide[2], of which nearly 60% have set reduction targets. In practice, this means that they have measured their carbon footprint along the entire value chain, either by estimating or based on real data, checked their reduction pathways to be in line with the Paris Agreement, and have a concrete plan to reduce emissions. There are almost 2,000 of them in Europe, and 52 operate in the TFL industry (Ground Transportation - Trucking Transportation as well as Air Freight Transportation and Logistics). In Poland, only 20 companies have joined the SBTi, with 11 having approved targets and only four being SMEs. By comparison: in the Netherlands (where Raben Group originates from), which is a much smaller country, 170 companies are affiliated to SBTi, 87 have officially approved targets, while 45 belong to the SME sector.

Even the smallest one matters

Our approach proves that it is by no means about corporations improving their statistics with someone else's efforts and impressing others in their annual reports with their sustainability progress. The smallest companies really do have a key role to play in the fight against climate change. Indeed we estimate that they are responsible for 79% of Raben Group's total emissions. In turn, a significant proportion of our issues fall within scope three of our customers. The foundation of this economic pyramid is made up of a huge number of micro, small, medium, but also large enterprises, on which a great deal depends, and which should therefore be involved in global climate action as soon as possible. The first step to reducing emissions is to know their sources, calculate their value, and finally develop a reduction strategy. In this respect, the smaller players need to follow the lead of the big ones, who in turn need to share their knowledge and experience. It is only through joint commitment that we have the chance to successfully address the climate crisis.

[1] Source: IPCC reports, including the most recent AR6 Synthesis Report summarising findings to date in this area.

[2] Here and hereafter: status as at 16.10.2023.