Which European companies are leading climate action?

Do you want to know which European companies are really involved in climate action? A new ranking published by the British Financial Times (FT) pays tribute to those who do their best to reduce their emissions.

Compiled jointly with data specialist Statista, Europe’s Climate Leaders 2023 lists 500 companies that “appear to be moving in the right direction”.

Swedish telecom company Telia comes out on top, followed by Germany’s Deutsche Telekom and Spanish technology company Indra Sistemas.

Other familiar names in the top 10 include Germany’s Porsche, Britain’s Carry and French luxury goods multinational Kering.

What do these companies do well and what can others learn from them?

What makes the company a leader in climate action?

The Financial Times did something a little different with its annual list this year, taking a deep dive to look at all the corporate issues.

Previously, the companies that met the requirements were simply those that achieved the greatest reduction in their GHG emission intensity in Scope 1 and 2 over a five-year period. These emissions come, respectively, from the company’s operations and the energy it uses.

Intensity calculates tons of CO2-equivalent emissions per million euros of revenue.

Scope 3 emissions come from elsewhere in a company’s value chain and are difficult to quantify. This is because there is no universally accepted measure about them; And since vendors don’t always provide reliable data, companies often choose not to say anything on that front.

But these hidden emissions often far exceed what has been accounted for in Bands 1 and 2.

The FT has – for the first time – assigned a score to companies that reflect their transparency in disclosing such data. Adherence to the Science-Based Targets Initiative (SBTi, which evaluates emissions reduction plans) and CDP’s Environmental Performance Monitor is also likely to put the company at the top of the list.

“Companies face increasing scrutiny from consumers and regulators about their environmental performance, and the methodology for this year’s list of climate leaders has been suitably bolstered,” wrote Neville Hocock of the Financial Times.

The emission reduction scale and climate commitments were combined to record each company.

Needless to say, energy companies looking for new fossil fuel sources and perpetrators of greenwashing were excluded. So do other companies whose environmental credentials have been shattered for reasons such as association with deforestation or non-greenhouse gas pollution.

How do companies deal with their emissions?

Sweden’s Telia – with a maximum score of 84 – reduced its carbon dioxide emissions by 85% between 2018 and 2022. It achieved this by switching entirely to renewable electricity, increasing energy efficiency and reducing business travel through virtual meetings. .

“We are delighted to have reached this milestone and to continue working on our strategy to reduce carbon dioxide and energy emissions for the coming years,” Sarah Nordbrand, Head of Sustainability at the communications company, told Euronews Green.

Telia is now suppressing emissions across its value chain.

“Most of our carbon dioxide emissions are generated in the supply chain, where we require suppliers to set science-based climate targets, as we have done,” says Nordbrand.

“We are excited to see that an increasing number of suppliers are joining us on this journey.”

By the end of 2022, suppliers who generate 35% of Telia’s supply chain emissions have set science-based climate targets, and the number continues to rise, he says.

In second place with a score of 82.5 points, Deutsche Telekom is moved by its ambition to become the global leader in digital and sustainable communications.

“The FT’s assessment is confirmation that we are on the right track. At the same time, it is another incentive to continue into the future at full speed,” says the spokesperson.

In its own operations, the company emits 94% less carbon dioxide than it did in 2017, on track to be completely climate-neutral by 2025. Last year, it cut its energy consumption in Germany by 278 gigawatt-hours — the equivalent of 11 % of the company’s total consumption.

“We want to achieve net zero emissions in the production of mobile phones,” CEO Tim Hotges told shareholders. Anyone who fails to achieve green production will eventually be removed from the pipeline. We import hardware. But we issue our own environmental protection standards.”

Deutsche Telekom has pledged that by 2040 its entire value chain will be climate-neutral, from device manufacturing to energy consumption for customers. Höttges is on the right track, targeting a 55% reduction in carbon dioxide emissions by 2030 compared to 2020.

Globally, financial services accounted for the largest number of the top 500 companies at 12.2 percent. Transportation, logistics and packaging followed, followed by energy and utilities.

The UK was home to 25% of the companies on the list, according to the Financial Times. It is followed by Germany with 14.6 percent and France with 11.4 percent.

Why do companies control their emissions now?

Big companies generally have bad press about the weather.

But times are changing. The devastating effects of climate change in Europe – from last year’s record heat wave to the current drought afflicting countries in the south – are exhausting people’s patience with the private sector.

The European Union has committed to achieving net zero emissions by 2050, and the EU bill seeks to stamp out allegations of greenwashing.

To help keep misleading data out of its own rankings, the Financial Times enlisted GreenWatch, a sustainability research team at University College Dublin, to analyze the numbers of those who cut emissions the most.