In this article, we explain the net-zero meaning, what it takes to be a net-zero business, low/zero emissions business practices that you should know, and skepticism around carbon offsetting.
Explaining the Net-Zero Meaning
The term “net-zero” refers to the amount of carbon emissions released into the atmosphere being offset by an equal or greater amount of emissions being removed from the atmosphere. The aim is for all sources of human-caused emissions to be equal to zero resulting in a net-zero balance.
In order to achieve the net-zero balance, businesses and countries must look at ways of reducing their carbon footprint through increased energy efficiency measures, renewable energy use and other forms of carbon capture such as planting trees or creating wetlands that absorb carbon dioxide from the air. It is important that all global players are committed to implementing these measures in order to slow the impacts of climate change on our planet.

Defining a Net-Zero Business
The term “net-zero” has become increasingly popular in recent years, with business leaders looking for ways to reduce their environmental impact by taking steps toward sustainability and carbon neutrality. By becoming a net-zero business, an organization seeks to balance the amount of greenhouse gasses it emits with the amount it removes from the atmosphere.Therefore, net-zero businesses take an active approach to offsetting their carbon footprint by focusing on low/zero emission initiatives such as energy efficiency, renewable energy, carbon sequestration, waste reduction, among others.
Benefits of Being a Net-Zero Business
For companies striving for net-zero status, there is a direct economic benefit to be had from becoming more energy efficient and reducing inefficiencies and waste. This can lead to lower operational costs and utility bills, streamlined processes and lower strain on equipment. Working towards net-zero also grants companies a greater understanding of their emissions and environmental impact, and how their operations impact the people, wildlife and communities around them. Following net-zero practices enhances company reputation and transparency which attracts eco-minded job seekers and customers. Companies that strive for net-zero strengthen their trustworthiness among stakeholders and have a greater chance to win bids, partnerships and other business opportunities.

What It Takes to Be a Net-Zero Business
Achieving net-zero status requires that a company actively measure and monitor its direct and indirect emissions and regularly review its practices and policies. Below we’ll discuss a variety of strategies that will help you achieve net-zero.
Understand Your Direct and Indirect Emissions
In order to reduce your total emissions, you must know where exactly they are rooted within your value chain and business activities. There are two sources of emissions for companies: direct and indirect.
The Greenhouse Gas (GHG) Protocol, the global leader in measuring, managing and reporting emissions, defines direct emissions as “emissions from sources that are owned or controlled by the reporting entity.” Direct emissions are often referred to as “point source” emissions because they come from a specific source or location. Some examples of direct emissions are: factory fumes from manufacturing goods, fuel emissions from company vehicles, emissions from onsite landfills.
Indirect emissions, on the other hand, are “emissions that are a consequence of the activities of the reporting entity, but occur at sources owned or controlled by another entity.” Some examples of indirect emissions include: purchased electricity, purchased heating and cooling, employee travel and commute, vendor-produced emissions, etc.
The GHG Protocol developed three carbon emission scopes to help organizations map out their direct and indirect emissions. While carbon reporting is mandatory for many high producing companies, more and more companies are choosing to disclose their emissions data in order to increase their transparency.
For more information around Scope 1, 2, and 3 emissions, read the following articles:

Conduct an Energy, Water or Waste Audit
Reducing your consumption and waste should be the first action you take towards becoming a net-zero business. A good chunk of emissions can be avoided simply by fixing the inefficiencies in regular business operations. Conducting an energy, water or waste audit can identify weak points along your value chain that lead to under utilized resources and unnecessary waste. Audits are a powerful tool to make sure your business is running at peak efficiency and keeping costs low. Energy, water and waste audits essentially work the same way: A third-party professional or internal employee gathers data around energy/water usage (i.e. utility bills), maps out how these resources are utilized from the time they enter the facility to when they exit, looks at waste generation and management practices, and identifies strategies for increasing efficiency whether that’s by re-calibrating equipment, upgrading to higher efficiency equipment, simplifying the steps of a particular process, etc. By enhancing the efficiency of your business operations, you reduce the amount of energy and resources used, thus lowering your carbon footprint.
Check out: How to Implement a Water Audit for Business
Employ Low/Zero Carbon Practices
There are several low/zero carbon practices that companies should follow if they want to achieve net-zero:
- Switching to updated energy efficient equipment, appliances and lighting
- Investing in onsite renewable energy to power company vehicles, facility heating/cooling, and other facility processes.
- Purchase certified products that are environmentally and socially responsible
- Ditch single-use plastics and switch to green packaging alternatives
- Provide public transportation or carpooling for employees
- Choose green building materials for future construction projects
- Use passive heating and cooling and natural lighting whenever possible
- Follow regular maintenance procedures (i.e. check for HVAC leaks) and do not prolong repair jobs
- Launch an at-work recycling program
- Donate annually to carbon sequestration projects (i.e. reforestation and wetland restoration)

Purchase Carbon Offsets
Another way to achieve net-zero status is by purchasing carbon offsets but this should only be a last resort and be allocated to residual emissions that are hard to eliminate completely. Simply put, carbon offsets are a form of compensation that allows organizations to reduce emissions via GHG capture projects or clean energy to offset the emissions they create elsewhere.
Carbon offsets can be purchased from a range of providers, from government-sponsored programs to private companies. Most carbon offset projects are done on a voluntary basis, but some countries have set up mandatory carbon markets where companies must purchase a certain amount of offsets each year as part of their national climate change strategy. By purchasing these credits, the buyer is helping fund projects that will reduce the overall release of GHGs into the atmosphere, such as reforestation projects or investments in renewable energy sources.
However, there is much global skepticism around carbon offsetting, viewing the process as an easy way for companies to buy their way out of taking true accountability for their environmental and social impacts.
Read: Carbon Offsets vs Carbon Credits: The 5 Rules of Carbon Offsetting and How To Buy Carbon Offsets: 6 Certified and Vetted Options
Conclusion: The Future Is Net-Zero
While achieving absolute net-zero is often unfeasible for many companies, the true objective should be to continually look for more ways to reduce emissions whether that’s through an ambitious investment in renewable energy or instilling mindfulness in your employees around their daily consumption habits. With ongoing advancements in energy efficiency and clean energy, and a global rallying towards responsible business practice, the future continues to lean towards net-zero and there is no going back.