As a retailer interested in sustainability and responsible environment business practices, chances are you were glued to the coverage of COP26 last year. High profile, high stakes events such as this are always a hot news story – and in 2021, the UN’s 26th Climate Change Conference seemed committed to making real progress with ambitious goals.
As the dust settles, what are the tangible takeaways that our ecommerce industry has picked up to run with? Big change necessitates big commitments – is this something we’re seeing from the global businesses leading the charge when it comes to rewriting the way that ecommerce operates? And most importantly, how can smaller businesses act on their own commitment to change when it comes to the race to zero and the communal push towards carbon neutrality?
COP26: What Climate Targets Were Set?
COP26 brought together a record breaking number of delegates and provided United Nation member states with an opportunity to negotiate the way forward with regard to the Paris Agreement, made six years previously. This landmark commitment to limiting climate change to a 1.5 degree increase represented a legally binding international treaty, and COP26 sought to hold members to account over these commitments, by creating an updated pact to help with the preservation of this goal.
As COP26 President Alok Sharma noted “We can now say with credibility that we have kept 1.5 degrees alive. But, its pulse is weak and it will only survive if we keep our promises and translate commitments into rapid action.”
The outcomes of COP26 were laid out in the Glasgow Climate Pact, and were centred around the four key areas of: mitigation, adaptation, finance and collaboration. Most of the “headline” climate targets came from the first category – mitigation – setting solid targets for the reduction of emissions in the first instance. In order to achieve a global temperature rise of 1.5 degrees, the world needs to halve emissions over the next decade. Net zero carbon emissions must be hit by 2050.
What Does This Mean For Big Business?
The UK Government has committed to reaching “carbon zero” status by 2050, and in order to achieve this, large businesses are going to be held accountable for their contribution to emissions.
Following COP26, the majority of big UK firms and financial institutions will be required to demonstrate how they intend to hit climate change targets. This means that by 2023, they will need to be able to produce detailed plans (made publicly available) that illustrate the actions they can take to help the UK meet its 2050 net-zero target.
To ensure that these plans are realistic and achievable, an independent panel of experts will also make an assessment – an important factor that should help to avoid empty promises and green washing.
Sounds great? Well, there’s a catch. While these plans are mandatory, commitments made within them won’t be. In short: big businesses have to make a plan, but they don’t actually have to carry it out.
While many have understandably pushed back against this, more than half of the UK’s largest businesses did pledge to stop their contributions to climate change by 2050 at COP26. This suggests that the ‘Race to Zero’ campaign is gathering momentum, and means that net zero pledges from UK businesses have more than quadrupled in the last year.
What Does This Mean for SME Business?
If big businesses are being held to account (at least on paper), what did COP26 mean in terms of impact on the UK's SME sector? The Government is pushing the Together for our Planet Business Climate Leaders’ campaign as a way to rally interest and generate commitment and cooperation across a wide range of smaller businesses.
As Sasha Cebil, Communications Manager at the SME Climate Hub notes “The United Kingdom alone has 6 million SMES which generate £2.2 trillion of revenue to the economy, making them essential on the road to net-zero and a community that cannot be left behind as we transition to the green economy.”
SMEs are being encouraged to sign up to the optional SME Climate Commitment, incentivized by access to a free BS ISO 50005 Energy Management System (a set of tools to help drive down energy bills, and by extension, emissions.)
The SME Climate Commitment asks businesses to follow the same targets applied at a big business and national level: halving carbon emissions by 2030 and reaching ‘net zero’ by 2050.
How is Ecommerce going to be impacted by COP26 Targets?
COP26 placed a strong focus on “full chain” impact analysis of businesses – ensuring that we take the full measure of every aspect of operational impact, including close inspection of emissions linked to the “hidden” component of supply chain logistics.
Ecommerce has, understandably, a significant relevance here. While the “tip of our business’s iceberg” is conducted in the digital realm, the real life impact of physical manufacture, packaging, storage, shipping, last mile delivery and the increasingly problematic cycle of returns all lurk below the surface – and add up to a considerable burden.
As ever, the need to stay competitive represents a considerable barrier to ecommerce businesses committing to change - bringing them closer to COP26 targets. In a growing market, for many, the “race to the bottom” is more commonly linked to slashed prices than it is to emissions. Customer experience is such a strong motivating factor that the risk of diminishing this and losing out to a rival brand might simply feel like too much of a risk.
But the tide is turning. Increasingly, as conscious consumerism becomes established, there’s a growing expectation (and preference) for ecommerce brands that are actively taking steps towards sustainability – and providing greener options, especially around factors such as delivery. 52% of online shoppers, for example, now claim to choose one online store over another if the environmental impact of its delivery is lower.
Towards the end of 2021, data on businesses' net zero actions suggested that “implementing change being costly” was the main barrier preventing businesses from acting (20% of those surveyed.) However, as an industry well-served by technical innovation, ecommerce is well-placed to enjoy operational savings as a result of increased efficiencies. A great example of this comes from the development of automated packaging solutions, which can scan items ready for shipping and create a perfectly sized box – saving wasted packaging materials and expenditure.
COP26 targets helped to bring business emissions more firmly into the public consciousness, and so taking active steps to meet them (and clearly referring to them within your brand communications) holds more promotional sway than ever before.
8 Actions Your SME Ecommerce Business Can Take to Help Meet COP26 Targets
What actions can be taken to ensure your SME ecommerce business plays its part in helping reach (or even exceed) the COP26 targets - halving business emissions by 2030 and achieving complete net-zero by 2050?
We’ve compiled 8 steps you can take to bring your ecommerce business in line with the COP26 targets, reduce your operational costs, improve business trust and transparency and enhance your market positioning all at once. So, what are you waiting for…
1. Get a true measure of your impact
Recent data suggests that a big blocker to businesses not taking action to reduce their environmental impact was the simple issue of not knowing how to get a handle on their starting point. In fact, more than 1 in 10 (13%) of businesses not taking action were ‘unsure of how to measure their emissions’.
You can’t reduce what you can’t measure. So, what can your ecommerce business do to learn more about its current emissions?
The Carbon Trust offers a great online tool for getting a measure of where you might currently be sitting and is well worth exploring.
The SME Business Climate Hub also offers solid guidance on measuring and reporting emissions, linking to a range of tools and additional advice, tailored to smaller businesses.
MindfulCommerce partner C Free also offers a fantastic service here, with a very transparent, helpful and deeply knowledgeable approach to calculation. Community members (joining is free, find details here) can also access a recording of the Live Training that C Free ran on how to measure your carbon footprint as an ecommerce business.
2. Accept that perfection is impossible
This next step is less technical - but we’d argue every bit as important as knowing your current emissions. While we are aiming for net-zero by 2050, the pathway is not going to be linear. So many businesses are paralyzed from taking positive action as a result of holding themselves to impossible standards.
At MindfulCommerce, our Sustainability Framework has always championed progress over perfection. Commit to small changes. In the same way that thousands of smaller SMEs taking action adds up to an enormous collective impact, your incremental improvements also make a difference to what you’ll ultimately achieve. Just make a start :)
3. Audit your tech stack
Working within ecommerce, you’re at a potential advantage. Technology is already your friend, and leaning upon digital tools and solutions to help achieve your targets probably feels familiar and unchallenging!
Take a step back and look at the tech that’s currently underpinning your operation. Your digital carbon footprint can be significant. Data centres could use as much as 3-13% of global electricity by 2030. To contextualise that statistic, the much demonised aviation industry currently generates 2% of annual human-generated CO2!
What’s the carbon cost of your ecommerce store? Look at the ways you might be able to drive this down, by considering:
Your hosting and ecommerce platform of choice. This should always run on renewable energy. We recently wrote about the factors that we believe make Shopify a great choice for sustainable ecommerce brands.
Focusing on a quick and efficient customer journey to keep digital journeys short and data use low.
Clean, efficient code and design that minimises data-heavy, slow loads.
4. Make a short and long term plan
The COP26 targets are split into two stages: a 2030 goal and a 2050 goal. Take inspiration from this – the message coming loud and clear from the very top here is “take a staged approach.” Don’t feel you have to reduce all emissions overnight. Take a breath and create a strategy that acknowledges the pace at which you can make some changes.
The MindfulCommerce Sustainability Framework is built around this mindset: quick wins and longer term goals combine to give you short-term, motivation-boosting impact as well as a longer run at those bigger changes that you simply can’t inflict on your business overnight.
5. Get a second opinion
Once you’ve made your plan, it can be useful to “sense check” it with an external party. Whether you seek expert advice or simply find a trusted local business willing to give you their own take on your ambition (and provide the kind of objective input that you might be too close to provide to yourself!) Some outside perspective is always valuable, and if an issue is spotted at this stage, you’ll be able to reassess and get something much more effective in place from the very start of your improvements.
6. Find your community
The wonderful thing about the COP26 targets is that they are universal – businesses of all sizes, sectors and nationalities are pulling together for the greater good and a common goal. Because of this, many are willing to share their successes and help others move closer to their own targets. Ecommerce is a specialist niche with a unique range of challenges, and so working in close collaboration to share knowledge of new tech, services, apps and providers can be immensely beneficial. Check out the MindfulCommerce Community, which offers an online space for like minded ecommerce professionals to share their own experiences within sustainable online retail.
7. Communicate your actions
Be upfront and honest about your progress towards targets. Not only will this give you some relatable, engaging content for your marketing and social campaigns (allowing customers some “behind the scenes” context that helps make your brand more relatable), you’ll also appeal to more conscious consumers who are looking to reward brands doing the right thing for our planet with more custom. Additionally, you’ll inspire (or shame!) your competitors into doing the right thing as well!
8. Set up regular reassessments
Finally, be sure to keep checking in on your short and long term goals. This will help keep you accountable, but also give you a good overview of what measures are proving most effective – valuable knowledge that you can apply to other areas of your business, or share more widely through the rest of the ecommerce community.
Get Ready to Help Your Ecommerce Business Meet COP26 Climate Goals
While taking action to meet COP26 targets is not mandatory for SMEs in the UK, as momentum grows, we hope that businesses are rapidly running out of reasons not to commit to action and get a plan in place!
MindfulCommerce has a wealth of educational resources, technology experts who can help bring down your carbon footprint and a thriving, supportive and knowledgeable community who are ready to advise and cheer you on.
Looking for more advice and support when it comes to getting your SME ecommerce business to net zero? Join the free MindfulCommerce community!