Right now the auditing giants (Ernst & Young, PWC, Deloitte and KPMG) are rubbing their hands together with glee. Already servicing between 80-90% of the financial audits required by the world’s publicly quoted companies they are now tooling themselves up to satisfy a whole new audit and compliance market thundering down the tracks. What’s better than one massive compliance market? Two, of course.
All the cool kids in compliance and auditing are now talking about Net-Zero, because it’s becoming clearer day-by-day that nearly every firm is going to be required to legally disclose their emissions (if they’re not already) and publish their plans to reach net-zero – plans which will be scrutinised by auditors and regulators. (There’s even talk of rates of corporation tax being pegged to performance against net-zero).
This is not idle chat. For instance, the UK (where CUR8 is headquartered) has a legally binding net-zero law, the Climate Change Act of 2008; an unequivocal piece of legislation that commits the UK to net-zero by 2050. Laws can be tested in the courts, and this one was. Client Earth (for whom two of our co-founders are ambassadors) successfully proved the government’s climate policies would fall well short of its legal obligations. The high court judgment against the government resulted in a whole new department (for Net-zero and Energy Security) instructed by the courts to publish an updated plan for the nation. A national net-zero target and plan translates into one for every government department, local authority and nearly every organisation in the UK, and similar moves are afoot across the globe from the EU’s Long Term Climate Strategy to Canada’s aptly named Net Zero Emissions Accountability Act. It’s why you already can’t get government contracts in some countries unless you can demonstrate net-zero ambition.. Are you ready?
From planning to delivery
Leonard Bernstien famously remarked, “To achieve great things, two things are needed; a plan, and not quite enough time.” It’s very clear we have left action on climate change too late, but the new round of net-zero legislation (and the compliance requirements that pour out of it) do begin to form something of a plan. However, our collective lateness to address climate change has far reaching implications for how that plan must be delivered – and it’s the reason CUR8 (and our sister NGO Rethinking Removals) exist.
Take a look at any of the legislation and you will see that carbon removals (not offsets) are embedded in the logic and language of them all. That’s because we simply can’t hit net-zero without removing gigatonnes of carbon from the atmosphere (as well as radical reductions in emissions). Already the EU is passing legislation to combat greenwashing and misleading ‘carbon neutral’ claims powered by the use of offsets. That means that the net-zero plans of nearly every organisation will have to include a carbon removals strategy to satisfy the needs of legal compliance. Simply put, if you don’t have a plan to remove (not offset) your residual emissions you won’t be able to demonstrate net-zero, and your auditors, regulators and civil society will punish you for it.
It therefore makes cold, hard commercial sense to get ahead of the game. This is one of the reasons we built CUR8, to create enough capacity of high-quality carbon removals to satisfy the needs of legislation and the forthcoming tsunami of demand. But let’s be clear, because (as a planet) we’ve left it so late, demand for removals will outstrip supply for the foreseeable future, which means the longer you leave it to build a removals strategy the more expensive it’s going to be, with all the attendant commercial and compliance problems that entails.