Carbon neutrality, De-carbonisation, Carbon credits, Carbon offsets, Carbon sequestration, CFCs global warming, Adaptation fund, Kyoto Protocol, Bali Roadmap, Paris Agreement, G-77, UNFCCC are terms we are increasingly getting familiar with as more and more people across the world engage on issues of climate change. 

To that list add 'Just Transition' - an initiative of the World Benchmarking Alliance(WBA). In light of the crucial role the private sector has to play in achieving a low-carbon world, the WBA intends to assess 450 of the world's most influential companies in high-emitting sectors on their contribution to a just transition by assessing their alignment with the goals of the Paris Agreement alongside their approach to addressing the social challenges of a low-carbon transition. The assessment covers what the companies are doing to respect the rights of workers, communities and the most vulnerable as they work towards low-carbon goals.

To learn more, I spoke with Natasha Zervudachi from the WBA about sustainability and sustainable development 👇🏾👇🏾

👉🏾 The big challenges facing our planet

👉🏾 How are governments and the private sector ensuring that as we work towards addressing climate change, we're not creating even greater inequalities or creating mass unemployment or increased poverty as a result of that transition to this new, more carbon neutral world? What we can do to ensure a 'just transition' that is fair and equitable

👉🏾 What the WBA is doing to incentivise businesses to encourage uptake, learning from best practice and roadmaps for those at the start of the journey

👉🏾 Steps the WBA is taking to ensure that 'just transition' balances voices from global south since advocacy on climate change and de-carbonisation is dominated by voices from global north

👉🏾 The importance of embedding concerns of marginalised people in the design of the assessment 

👉🏾 The short term and long term ambitions of the WBA for the initiative, the 'Just Transition Coalition' and much more

To learn more listen here 👇🏾👇🏾

Memorable passages from the episode:

👉🏾 Thank you so much for having me. I'm a massive fan. So it's a real, real pleasure to be here and to get to speak to you today

👉🏾 Really, really good and interesting question there. I guess to give listeners a tiny bit of a background on who I am and where I come from. So I'm speaking today on behalf of the World Benchmarking Alliance, which is a global organisation that essentially develops free and publicly available assessments and benchmarks to measure company progress and performance towards the sustainable development goals, and the Paris Agreement. So I think, this question as you said, we can definitely see that it's being talked about much more. It's appearing within public reporting. But what we have found for our benchmarks is that there is hugely still like a massive disparity of approaches when it comes to sustainable development and the reporting of progress on that. And I would have to say that certainly for many companies, it is still either completely missing, or we do still see it as purely kind of a tick box exercise or a compliance exercise where it's purely kind of meeting legislation, rather than being kind of fully integrated into the business strategy. So if for example, we recently did a kind of holistic assessment of all 2000 companies that we've benchmarked, within our benchmarks and these are the 2000 companies that we've identified as being the most influential companies in supporting the systems change that's really needed within their industry in support of this UN Sustainable Development Goals. And of those 2000 companies, we found that 775 of them aren't even mentioning sustainable development goals within their corporate communications. And when we kind of throw our benchmarks, dig deeper, those companies that are talking about sustainability, a lot of them it's still kind of smoke and mirrors tactics or greenwashing rather than that true integration of sustainability into their business practices 

👉🏾 Yeah, definitely. I mean, as you said, with COP26 is in full swing. It would be certainly be remiss to not say that climate change is the glaringly obvious kind of biggest challenge that we're facing as the world. But the truth is, so many of these challenges that we do face when we talk about sustainable development, they are very interconnected. So you can't kind of look at each challenge in a silo

👉🏾 And when you begin to dig into the UN Sustainable Development Goals, I think this becomes really apparent. If you start to look at them as individual problems and try and treat them as individual problems you don't get very far. So if we take climate change, for example, or lack of action towards climate change, that is going to have a huge impact on things like access to water, poverty rates, health and well being, gender equality. I mean, the list really does go on. And I think, companies therefore, really do need to take a holistic approach to sustainable development. And they need to be much better integrating kind of looking at those sustainable practices and approaches, both across their business and their value chains in more strategic way exactly as you were saying, rather than these kind of side projects, big PR pieces that sound really good and you can make good sound bites of, but you're not really changing the way that you're doing business. And I think that's the key, really

👉🏾 So at WBA we take what we call a kind of systems approach to sustainable development, which means we're focusing on the whole interconnected nature of the sustainable development challenges rather than on a single specific element in isolation. So I think, the reality is, the issues that are facing the planet and humanity, they are so interlinked, and they all impact on each other massively. So, we're talking here today about the Elephant in The Room. And I think for me, the real Elephant in The Room is how do we ensure that as we tackle climate change, we are ensuring that that transition to a lower carbon economy happens in a way that doesn't leave anyone behind and is just an equitable for all people

👉🏾 Yeah. We released on Monday, so yeah two days ago. We had our public launch event yesterday. I guess, first maybe just in case there's any listeners that might not be familiar with the term “Just Transition” it's essentially what I was just talking about. So how are we taking an integrated approach to sustainable development challenges and in this case, specifically, how are we ensuring that as we work towards addressing climate change, do we ensure that we're not creating even greater inequalities or creating mass unemployment or increased poverty as a result of that transition to this new, more carbon neutral world

👉🏾 I think it's very clear when it comes to the climate crisis, what that mission is. We need to halve global carbon emissions by 2030, we need to ensure zero net emissions by 2050. But what does that actually mean for the huge number of people that currently work in those industries that we’re sort of saying you need to go. So, if we look at oil, coal production, we're saying that these industries essentially cannot exist in 20/30 years if we're going to meet these net-zero goals, but there are literally millions of people that currently work in or rely on these industries and they have done it for generations. Proportionate number of those workers and especially as we look further down the supply chain, are based in developing countries. And if we look, one at the direct employees, that's one big issue, but then we've got the supply chains, we've got the communities around those workers, that all rely on these industries and they're all propped up by these industries. So as companies are developing their net zero emission plans, they need to be building in to those strategies. How do they ensure that as they transition, they're making sure that they are bringing people along with them to avoid any negative impact on people and they're supporting those people into new and green jobs

👉🏾 So what we've developed at the World Benchmarking Alliance is a methodology and a set of six indicators that basically assesses how a company is doing exactly that. So we look at how they're developing their plans, we look at how they're engaging their employers in these conversations so that they're making sure the employees are part of those decisions that are obviously going to be impacting them most. Then we look at how they're developing the skills of those workers so that they can transition into these new industries, these new green jobs. And then we also look at how the companies are working with governments to ensure that social protection systems are adequate and to ensure that the companies are not locking governments to create the enabling policy environment that will ensure that this transition is just and is equitable

👉🏾 The assessments that we released on Monday, so we looked at 180 companies from high emitting sectors. And what we basically found in those assessments is there is currently a striking and very systematic lack of action by companies to do this work on a 'Just Transition'. So whilst a lot of them have low carbon strategies, very few are actually working to identify prepare for and then mitigate the social impact of those strategies. And out of that 180 companies we found that only 9 scored 50% mark on the six 'Just Transition indicators. 

And really, most companies right at the start of this journey and what this means is that there's essentially those 180 companies just in themselves, they employ eleven million workers, so those workers are potentially being put at risk if they're not being included in these decisions about how the company is changing. And that's the conversation we want to start and that's what we want to engage companies in 

👉🏾 So no it's not just oil and gas. So our benchmarks are all focused on company progress towards the sustainable development goals. So our initial assessments have looked at 100 oil and gas companies, 50 electric utilities companies and then 30 car manufacturers, because these have all been identified as high emitting sectors. But then in terms of influence and who are the benchmarks intended to, so they are partly intended for companies to understand where their gaps are to understand how they perform against their peers. But then they are also intended for the use of stakeholder groups such as investors and NGOs and civil society organisations and policymakers all of whom work with and have the ability to influence corporate progress and also to hold companies to account

👉🏾 It's not mandatory in the fact that companies aren't obliged to engage with us and they're not obliged to do better on the benchmarks, but there is no ability to opt out. So, we basically select companies based on how influential they are within the systems change that we have identified as needed within their industry. So if you're on that list as a company, we will assess you, you don't sort of get the opportunity to opt out. We also do try and engage companies in the assessment process and we try and engage them in the feedback process. And they do have an ability to kind of feed in to that and to learn from us as well. We want this to be a useful tool for them not just a kind of naming and shaming

👉🏾 And with these 'Just Transition' assessments, for example, we found that a third of companies have engaged with us which, considering this as a pilot year is really great. We think that's a really positive sign already and hopefully that will only grow year on year. The way that we sort of incentivises companies, I guess is creating this race to the top but it's also about providing anyone that's lagging behind with a roadmap of what needs to be done. So we say it is in the company's favour if they engage with us. In the report that we just released on Monday there's a large number of best practice examples and case studies of those companies that are doing this really well

👉🏾 And what we hope is that, that gives companies, one it sort of takes away company's abilities to say "this is too hard, we can't do it" because here are companies that can and they are so here have a look what they're doing and learn from their best practices. And then it's also about as I said sort of giving other stake holders, like investors, like policymakers, kind of concrete data, that they can actually then use within their sphere of influence, to be able to incentivise further action 

👉🏾 That's a really good question and it's something that we do `consider a lot at the World Benchmarking Alliance. So Inclusivity is one of our core values. And I think it's early and continuous engagement and inclusive dialogue is key really. At World Benchmarking Alliance, we try to ensure that we're inclusive both with the companies that we assess, but also the allies that we work with, and the countries that we work in

👉🏾 So this is one of the key reasons why, when we look at companies we’re basing that on that influence rather than just their size or their turnover, we look at things like where are their subsidiaries based, where are their supply chains based, because this often is in the Global South. And it's also where we have a number of colleagues that work all over the world, colleagues based in Asia, South Africa, South America, and that's to ensure that we have kind of an on the ground ability to engage with companies with allies and with partners kind of locally

👉🏾 That's another great question and definitely, in developing our assessment methodology, so we had an advisory group made up of 16 people, those people all have expertise within 'Just Transition' topics specifically but they also bring the perspectives from a number of different stakeholder groups such as labour unions, civil society business and employers, policymakers. And we made sure that those voices were based across all five continents. We also then went through a public consultation stage to ensure that our methodology could be consulted on and we could get feedback publicly. And we held a number of round tables for feedback as well

👉🏾 And going through that process, we were able to ensure that the views of a huge number of stakeholders were taken into account, in particular, those that were focused on, vulnerable and marginalised groups in society as you said. And what this has kind of resulted on in our methodology through having those voices at the table a number of our indicators specifically assess how companies are ensuring that vulnerable groups, so women, migrant workers, indigenous communities, are included within their transition plans. But it's also even more importantly in a way is looking at how companies themselves are including the voices of those people that they see as most impacted within their own company in supply chain because for each company that's going to be different. So our assessment looks at how companies are doing that, how they're engaging with workers and with those communities, to ask them what they need, what they want, how they can be brought along on this journey. Unfortunately, what we found in our assessment sort of to date, only 8% of that 180 companies currently are demonstrating that they are engaging those workers in those communities in social dialogue. So it's sadly not currently happening the way that it should be, but it's certainly something that we're really supporting and we're really looking at through these assessments

👉🏾 But at the moment as I said companies do seem to be very near the beginning of this journey. We've only seen that 7% of companies have actually made a public kind of time bound target to mitigate the social impacts of their Just Transition on their workers, communities and business relationships. So it's certainly area thats a lot of room for improvement 

👉🏾 Yeah, definitely. So I think the very short term practical steps at WBA is we'll be integrating the Just Transition methodology, so this new pilot methodology that we've just released the first assessment of by Monday, we'll be integrating that into our climate and energy benchmark. So next year, we'll be assessing 90 transport companies and we'll publish that in Q3 2022. And we hope having that much integrated approach will mean that we're assessing companies on their environmental and social risks and impacts and how they impact on each other within each company. But in terms of the kind of longer term ambitions and impact, we are at the same time publishing our results. We've also launched what we call the Just Transition Coalition. So this brings together again, going back to those other stakeholders like investors and policymakers, and also research and academia brings them together collectively to work on Just Transition impacts and drive impact on the ground through what we've identified within our assessments. And within that coalition, those different stakeholder groups will make commitments depending on who they are and depending on their unique position within the ecosystem of influence. They will make commitments on how they can support this

👉🏾 So for investors for example, they might commit to engage companies to create better just transition plans and then commit to base their investment decisions based on the quality of those plans. So that's kind of what we want to get to and what we want to drive towards. And I think in terms of what does success look like, I guess again, on the very high broad level, success would be that the necessary transformation to a low carbon economy doesn't lead to mass unemployment, doesn't lead to the collapse of entire communities. And it's also actually taken as an opportunity to fix some of the economic injustices that we currently have existing in our society. I guess for us at WBA it's about encouraging action and being part of the ecosystem and providing clear, robust and simple metrics that can inspire companies, investors and policy makers to move on this journey. You know, as I said earlier, the 'Just' part of the transition really needs to stop being the elephant in the room when we're talking about climate change, the race to net zero, it's not a race against each other. It's a race against time. And we're only going to win that race if we run it together. And we ensure that these impacted workers and impacted communities aren't left behind

👉🏾 I mean, I'm going to remain hopeful, I think it has to really, if it doesn't happen now, then we are all going to be in a pretty terrible state of affairs. And I think that's what I really do hope that it's not all just talk, and we walk away from this without, really moving the needle and creating the catalytic changes that needs to happen. There's got to be action behind these commitments. And I think that's the key

And again, making sure that when we're making these...