Transport News

Study Exposes “Concerning Lack of Progress” In Global Transport Decarbonisation

A ground-breaking study by the World Benchmarking Alliance released on 18th October 2022 revealed that urgent action is required for the world’s major transport companies to invest in, collaborate over and scale a low-carbon transition.[2] Despite transport being collectively responsible for 37% of global emissions, the study finds the progress on net-zero is “limited” and likely to deeply impede on the sector’s ability to meet its 1.5 Celsius temperature target outlined in the Paris Agreement 2015. [3] Using a methodological measure called the Assessing low-Carbon Transition (ACT), on 90 major companies across rail, shipping, road and air transport sectors, the study produces five key findings: net-zero targets are insufficient, expertise and platform is not being mobilised, investment will not meet the emissions requirements in time, the transition needs to be accelerated in a just and equitable fashion for workforces and human rights need to be protected.

The first three of these findings indicate decarbonisation features low on transport companies list of priorities. Indeed, the study finds a staggeringly low 7% of the companies it assessed were committed to phasing out fossil fuels, with only six out of 90 working “directly” with infrastructure operators to build low-carbon solutions, both woefully small proportions given the scale of the challenge decarbonisation presents. Only 51% of the companies had outlined net-zero targets, and even these lacked “detail, depth and intermediate targets”, making it difficult to track “progress and contributions towards the Paris agreement goals”. [4] This lack of detail makes it difficult for organisations like the World Benchmarking Alliance, to set “transformative benchmarks that will compare companies’ performance on Sustainable Development Goals”, or in other words, perform its task. [5] Are companies deliberately concealing targets to avoid fairing badly in climate comparisons, or are they just indifferent climate policies?

The fact that 90% of transport energy comes from crude-oil products might persuade companies to resist the unchartered territory that net-zero alternatives represent. This impression is certainly implied by transport-related revenues, only 0.3% of which are reinvested into research and development of low-carbon technology, with 94% companies not providing any “meaningful data” on their sustainability investments. [6] Clearly companies are failing to see the net-zero challenge as an investment opportunity, and not mobilising their wealth of industry expertise to convince key stakeholders to lead a climate strategy, instead, as the report argues, relying on “other stakeholders for solutions”.

The last two findings show companies are failing to prepare for the widespread disruption the decarbonisation transition will inflict on workers. The report describes a “striking and systemic lack of action” by companies to mitigate the “social impacts of decarbonising”, and thus all scoring 0 on just transition planning. [7] The report’s criteria for adequate planning includes social dialogue with stakeholders, thorough planning, measurable indicators, and a disclosure of company preparations, all of which the report found to be lacking. Measures for reskilling and upskilling of workers fared slightly better, with 38% of companies meeting commitments. [8] However, the fact remains, transport companies are significantly worse than the oil & gas, electric utilities, and automotive sectors for preparing for the transition to net-zero. 

However, despite damning evidence of its lacklustre efforts, the report does highlight the highest performing transport companies across the transport benchmark. The top five companies in descending order were ComfortDel Corporation (Road and Rail), La Poste Groupe (Multimodal), FirstGroup (Road and Rail), NS Groep (Rail) and Maersk (Shipping), with the highest performing aviation company being Japan Air at 18th. [9] Perhaps, these companies will forge a path for others to follow and create a tipping point for huge progress on sustainability goals.

However, the World Benchmarking Alliance’s Decarbonisation and Energy Transformation Lead, Vicky Sins, resists this view, arguing “there is an urgent need for collaboration”, with “every company getting actively involved across their business”. [10] CDP’s Global Director of Climate Change, Amir Sokolowski adds that benchmarking will be essential to the process and calls on companies to “go further” in setting “not only long-term, but near-term targets and credible climate transition plans”, so they can be “measured and managed”. [11] The time for transport companies to deliver the study’s core recommendations; disclosure of plans, sustainability investments, net-zero targets, and leadership, has come.

References: 

[1] Press Release: Decarbonisation progress of world’s transport companies shows concerning lack of progress

[2] 2022 Climate and Energy Benchmark on the Transport Sector Insights Report, p. 26

[3] Press Release: Decarbonisation progress of world’s transport companies shows concerning lack of progress

[4] 2022 Climate and Energy Benchmark on the Transport Sector Insights Report, p. 3

[5] https://www.worldbenchmarkingalliance.org/

[6] Press Release: Decarbonisation progress of world’s transport companies shows concerning lack of progress

[7] 2022 Climate and Energy Benchmark on the Transport Sector Insights Report, p. 14

[8] 2022 Climate and Energy Benchmark on the Transport Sector Insights Report, p. 15

[9] Press Release: Decarbonisation progress of world’s transport companies shows concerning lack of progress

[10] Press Release: Decarbonisation progress of world’s transport companies shows concerning lack of progress

[11] Press Release: Decarbonisation progress of world’s transport companies shows concerning lack of progress

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