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Blog | Thursday June 29, 2023

Why Climate Transition Plans Must Support a Just Transition

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Climate transition action plans lay out the measures a business will take to reach net zero ambitions and facilitate their transition to a more sustainable and net-zero future. In addition, they should include climate objectives and goals and how they will be achieved, and outline protocols for governance and accountability, business and financial planning, implementation, organizational culture alignment, and engagement with stakeholders, value chains, industry, and policy. Transformative plans build resilient business strategies.

The Impact of a Net-Zero Transition on Workers

The transition to a net-zero economy and the ongoing impacts of climate change pose risks to workers and communities. As industries undergo the transformation necessary to reduce greenhouse gas emissions to achieve a net-zero future, workers face economic uncertainties and job displacements. As businesses switch to renewable energy and redesign products and services, workers will find their skills unaligned. For example, the IEA estimates that 5 million mostly well-paying jobs in the extractives sector will be lost by 2030, which will lead to near term shocks to communities and long-term structural impacts.

A transition to a net-zero future has the potential to harm local economies as company supply chains are moved to support low-carbon products and services. Local economies built around supporting the manufacture of high-carbon products, traditional industrial agriculture, and extractives operations face the potential for significant economic downturns.

Also, communities at the frontline of climate change will remain vulnerable to climate impacts such as extreme weather events. They will face challenges to recover and become resilient due to limited access to resources such as financing, insurance, healthcare, and clean energy.  

How CTPs Can Address Worker Displacement and Build Resilience

Climate transition plans should describe measures to ensure a just and equitable transition from fossil fuels to renewables and help build community resilience to climate change along companies’ value chains to ensure that workers and frontline communities are not left behind in the path to a net-zero economy.

By incorporating just transition considerations, companies can enhance worker and community resilience, and minimize material risks across the value chain. A just transition is not only an ethical imperative but also a strategic business approach that can lead to long-term success, resilience, and shared prosperity. 

Key Components of Climate Transition Plans That Support a Just Transition

1. Social Dialogue with Workers

Workers facing disruptions are adept at describing the challenges they face and what expectations they have from employers. The creation of a forum for social dialogue with workers will build respect and mutual understanding, which can lead to better long-term solutions. Climate transition plans should describe tools businesses are deploying to facilitate social dialogue with employees.

For example, Mercedes Benz created a “people plan” as part of its CTP, which has become an integral part of its sustainable business strategy. The plan describes how the company will invest in good working conditions, and provide continuing education for its employees. The people plan describes how internal conversations will be held with all departments to identify and pick up on new trends, share experiences and create secure jobs.

2. Co-creation of Solutions with Frontline Communities

Frontline communities understand the issues faced by cities and towns on the frontlines of climate change. They also understand what solutions are needed to minimize impacts and build resilience. Companies should engage in a collaborative process with communities to co-create solutions and take collective action. Climate transition plans should describe the strategies businesses are taking to co-create solutions with these communities.

For example, Microsoft is exploring models that link their carbon-free energy commitments with community-led clean energy projects, aiming to equitably distribute the benefits of the clean energy economy. Microsoft is partnering with organizations like Volt Energy Utility to establish new models, such as "equity PPAs," that not only bring renewable energy online but also create opportunities for frontline communities.

3. Deployment of Resources to Address Dislocations and Build Resilience

Beyond social dialogue and co-creation, business support of a just transition will require the expenditure of financial and capital resources. Climate transition plans should describe how resources will be deployed to support worker reskilling and retraining and to implement local solutions which promote community resilience.

4. Responsible Engagement in Public Policy to Support a Just Transition

Businesses cannot address these systemic problems alone. Global, national and sub-national policies are necessary scaffolds to motivate all parties to incorporate justice into required greenhouse gas emission reductions. BSR will describe how responsible policy engagement should be incorporated into climate transformation plans in an upcoming blog.

Climate transition plans must prioritize a just transition to ensure that workers and frontline communities are not left behind in the path to a net-zero economy. Incorporating a just transition perspective into climate transition plans is vital for ensuring an equitable and sustainable future.

By embracing shared prosperity, social protection, consultation, and collaboration, businesses can drive positive change while minimizing the negative effects of the transition. The development of an ambitious CTP which transparently declares the practical implementation strategies companies will take to address climate injustice and minimize worker displacement further supports their commitment to a just transition.

Blog | Wednesday June 28, 2023

Navigating Data Privacy in Post-Roe America

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One year ago, the US Supreme Court overturned the landmark 1973 ruling which established constitutional protection for abortion. The overturning of Roe v Wade enabled state governments to impose new restrictions, bans, and trigger laws on abortion and reproductive rights, severely curtailing human rights including access to healthcare, access to information pertaining to family planning, and the right to privacy, among others.

A year later, the policy landscape surrounding abortion remains uncertain and subject to ongoing litigation.

Legislative Developments

The past year has seen abortion access curtailed across the nation. Since the overturning of Roe, 24 states have enacted full bans or significant restrictions on abortion access, and active litigation in many states continues to cause confusion for providers and patients. Today, 25 million women of childbearing age now live in states with bans or restrictions on abortion.

State-level regulations on abortion and reproductive healthcare do not stop with bans and restrictions. A handful of states are regulating services connected to reproductive rights as well: Texas has recently introduced bills which would ban credit card companies from processing abortion-related transactions and would require internet service providers to ban access to websites that provide abortion information or facilitate access to abortion.

There are ongoing counter efforts to codify access to abortion at the national level, and state initiatives to pass legal protections, however, abortion-related cases continue to be disputed at the federal level. In April, the US Supreme Court blocked a proposed restriction on the drug, Mifepristone (part of the two-drug regimen for medication abortion); nonetheless, this case continues to unfold. And in May, a bill known as the “My Body, My Data Act of 2023,” was introduced to the Senate. If passed, it would protect sensitive sexual and reproductive health data by establishing data minimization requirements and enshrining individuals’ right to access and delete their sensitive health data.

User Data and Abortion

Amid the regulatory turmoil, a variety of questions have arisen about the role of data—and the companies collecting data—in both amplifying and addressing risks.

The past year has posed unsettling questions about how data collected by companies may be used to infer rightsholders’ abortion and reproductive statuses and what happens when law enforcement agencies demand that this data is shared with them.

Early cases caught the public’s attention, including one example involving a Nebraskan woman who was arrested for helping her daughter access an abortion after Meta was legally required to hand over her Facebook Messenger communications to law enforcement. Since then, there has been growing concern about the types of data that can be used to incriminate abortion seekers and providers such as payment data, location data, and menstrual app data.

For example, Google has pledged that it will not store location history for visits to abortion centers; however, some believe that the company has struggled to fully implement this pledge in its entirety, claiming some inconsistency with sensitive location history data. The company is currently involved in a class action lawsuit for tracking data from healthcare providers’ websites, including Planned Parenthood.

However, it is not just large technology companies that face these risks — companies in ad-tech, financial services, retail, and consumer healthcare do too. Companies like fertility-tracking app, Flo Health, and analytics company, Kochava, have faced penalties from the Federal Trade Commission for selling sensitive reproductive health data and location data from reproductive healthcare clinics respectively.

One year after the overturning of Roe, one thing remains the same: the evolving nature of the political environment and state legislation creates a challenging environment for companies to navigate abortion and reproductive rights related issues responsibly; with real consequences for rightsholders seeking timely access to reproductive care.

BSR makes the following recommendations for companies collecting data (including, but not limited to technology companies) to safeguard the rights and privacy of abortion seekers and providers:

Recommendations

1. Undertake human rights due diligence to identify risks to sexual and reproductive health that may be associated with the development or use of new or existing platforms, devices, products / product features. As part of their due diligence, companies should also consider state restrictions on reproductive rights or bans on abortion when deciding on the location of offices, data centers, or other assets that might give a state jurisdiction over the user data that the company holds.
2. Apply best practice privacy principles, such as data minimization, purpose limitations, purpose-based data retention, and user transparency and control.
3. Provide users with transparency about data practices, particularly for data pertaining to reproductive health. Increase the level of transparency users have on the types of data collected, how it is stored, how long it is stored, and with whom it is shared.
4. Embed guidance and support on privacy into the product or platform to protect users seeking sexual and reproductive healthcare services. This may take the form of click through prompts about password security, how to set up multi-factor authentication, or ways to protect privacy when users search for information pertaining to sexual and reproductive healthcare services.
5. Deploy end-to-end encryption on private messaging services.
6. Set default privacy settings to the highest level of privacy protection. Privacy protections should be based on an opt-out model, not an opt-in model.
7. Continue investing in efforts to ensure that policy commitments (e.g., “sensitive area” location data collection) are effectively implemented in practice.
8. Apply human rights principles (such as the Global Network Initiative Principles and Implementation Guidelines) when responding to government or law enforcement demands for user data.
9. Notify users when a government or law enforcement demand has been made for their data, when legally able to do so.
10. Support legislation intended to protect the right to abortion and the privacy of abortion-related data, including federal level privacy protections.

For further information, including how BSR can support you with conducting human rights due diligence related to privacy and data risks and reproductive services, please contact the team.

Blog | Thursday June 22, 2023

How to Engage Suppliers on Scope 3 Reductions

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The science is clear: companies need to halve greenhouse gas (GHG) emissions by 2030 and reach net-zero by 2050 to avoid the worst impacts of climate change. For some years, companies have had the chance to commit to these targets via the Science Based Targets initiative (SBTi) and directly contribute to reaching the goals of The Paris Agreement. Thankfully, the number of commitments from business has risen exponentially. 

Given that upstream scope 3 emissions on average are more than 11 times higher than a company’s operational emissions, supplier engagement stands as a critical avenue for reaching net zero. Supplier engagement represents relatively new territory for many companies. Many have yet to engage in difficult conversations with key suppliers to demand action, and best practice is in short supply.

BSR and the UN Global Compact Network Denmark made a ‘call for cases’ last year to gather good examples of how to engage suppliers in climate targets. The new report Supplier Engagement in Action: Examples from Denmark on Scope 3 Reductions is the result. It provides concrete examples and clear guidance in an effort to inspire and motivate other companies to take climate action with their suppliers.

The eight cases in the report prove that there is no “perfect recipe” for supplier engagement and scope 3 emissions reduction, and each company must create its own strategy.

There are, however, common actions from companies within the report:

• Integrate climate considerations into procurement: Procurement departments are on the ‘front line’ of scope 3 and need the education, tools, and business alignment to operationalize decarbonization into their everyday practices. TDC NET, a telecommunications provider, has created a specialized tool to determine the carbon intensity of sourced products and materials and puts supplier in its development program to support their decarbonization over time when lower-carbon alternatives are not available. Arla Foods, a dairy cooperative, has implemented a system where farmers will fetch higher prices for their products based on the climate and nature interventions they implement, such as land use, feed efficiency, soil biodiversity, and use of renewable energy.
• Top-down support and internal buy-in: Support from top management is necessary to ensure alignment between decarbonization and overall business goals, as well as necessary resources.
• Segmenting scope 3 emissions and suppliers: No company can tackle everything at once, so mapping the supply chain to locate hotspots, understand supplier maturity on climate, and identify possible abatement levers can help companies in taking tailored, manageable, and effective action on decarbonization.
• Continuous dialogue, cultural understanding, and supplier support: Companies may have a very diverse supplier base, so tailoring asks and solutions to specific geographies and offering materials in local languages can help bring suppliers along the journey more effectively.
• Tracking progress through best-available climate data: Effective climate action is underpinned by reliable climate data— the adage ‘you can’t manage what you don’t measure’ —so utilizing credible, third-party databases like CDP or collecting primary data can help to track and ensure progress over time.

• Partnerships for decarbonization challenges. Many challenges cannot be solved by any one company alone, making partnerships for decarbonization— such as R&D for lower-carbon products —a key component of decarbonization. For example, VELUX, a company that produces windows and related products, has identified its biggest GHG hotspots and co-developed a low-carbon solution using recycled aluminum to achieve reductions that were impossible if they acted alone.

We hope that these insights can help your company to advance your scope 3 strategy. In the decisive decade, we call on companies to take action, learn from their mistakes, and keep moving ahead on the journey to net zero.

Access to the full report: Supplier Engagement in Action: Examples from Denmark on Scope 3 Reductions

Blog | Thursday June 15, 2023

The US Supreme Court Ruling on Affirmative Action: A Business Response

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It is expected that the US Supreme Court may issue a landmark decision that ends the practice of affirmative action this month. The ruling would effectively ban US colleges and universities from considering race as a factor in admissions decisions which, as illustrated by existing state-level bans of the practice, can reshape the demographics and diversity of campuses for generations.

More broadly, as research has shown, the consequences of a national ban on affirmative action are likely to ripple throughout the US economy as decades of efforts to increase social and economic participation by historically excluded populations are upended and schools, businesses, communities, and governments become more racially, and even ideologically, homogeneous.

For business leaders that care about hiring and retaining diverse and exceptional talent, developing and delivering innovative products and services, and attracting a diversified consumer base, the end of affirmative action should be seen as more than another philosophical or policy debate in the so-called “culture wars.” Indeed, business leaders should understand and respond to the end of affirmative action for what it is: a significant and material risk to long-term corporate economic success.

As such, bold and committed action is needed in the months and years ahead to ensure that progress toward a more diverse, equitable, and inclusive economy is not lost, nor business value diminished. Even as we wait to see the final ruling, there are seven key actions businesses can take:

Underscore Your Company’s Long-Term Commitment to Diversity
 

• Reiterate your company’s commitment to building and maintaining a diverse workforce and organization. According to recent public opinion polling, 69 percent of adults agree that a company should respond to issues surrounding race, including supporting schools and communities teaching about the impacts of slavery and racism. Raise awareness of your company’s commitment to operationalizing DEI initiatives, developing products and service offerings that meet the needs of diverse communities, and supporting broader racial equity and social justice efforts.
• Commit to corporate accountability initiatives that focus on racial equity and DEI in the workplace. Business leaders need to be regularly exposed to and equipped with educational resources and practical tools and can seek out opportunities to participate in current and emerging civil society and philanthropically supported efforts. Among others, these might include:
   
  • Pilot new corporate standards tackling inequality from the Corporate Racial Equity Alliance, a partnership between PolicyLink, FSG, and JUST Capital. The standards will provide business leaders with clear goals to strive for, milestones along the path, and metrics to track in order to communicate progress in this work and earn greater trust. Piloting companies will receive individualized support from the Alliance and provide essential input to help shape the standards for the field.
  • Join the Expanding Equity network supported by the W.K. Kellogg Foundation, which offers resources, as well as learning and networking opportunities, for business leaders focused on advancing racial equity, diversity, and inclusion (REDI) strategies in their organizations. Several resources are available now, and a robust learning platform with courses on REDI strategy development and related topics will roll out later this year. 
• Assess your company’s hiring data to identify barriers to diverse talent acquisition and surface factors that may support the long-term hiring of diverse workers. This may include collaboration between human resources, communications, and legal teams to review job listings and ensure barriers and biases are eliminated. Companies may also evaluate their onboarding, performance review, and employee benefits policies and practices to understand where there may be opportunities to increase the retention of diverse workers.
   

Demystify Affirmative Action Impacts among Company Stakeholders and Bolster Good-Faith, Fact-Based Public, Policy, and Legal Discourse
 

• Support campaigns by industry groups and peers that inform how colleges and universities utilize affirmative action to enroll a diverse student body and highlight the direct and indirect impacts of the practice on your business. In the coming months, the broader narrative in the public around affirmative action is likely to be fueled by polarizing inaccuracies, misperceptions, and hyperbole. Business leaders should look to leverage their communications, policy, and other media infrastructure to elevate the discussion of affirmative action so that it is based on facts and the real, tangible ways in which the court’s ruling impacts your company and the broader economy. 
• Establish guidelines for your state- and federal-based political giving that minimizes donating to candidates who spread misinformation about affirmative action practices and impacts. As we head into what is likely to be a divisive and controversial election cycle, corporations can play a direct role in minimizing the extent to which bad-faith actors negatively influence public and policy discourse around affirmative action practice and impacts and the long-term benefits of a diverse, inclusive, and equitable economy, more broadly. Whether individually or in alignment with industry peers and other valued stakeholders, business leaders should consider how their political giving can be tailored toward political candidates and leadership that champion good-faith ideas based on fact and the economy’s long-term interest in mind.  
• Leverage philanthropic, community engagement, and corporate responsibility resources to foster the development of student admission approaches and strategies that support and safeguard diverse enrollment in higher education and at trade schools. Here, companies can collaborate with school leadership and educational associations to conduct regular engagement sessions or support research that informs admission officials’ understanding of potential admissions approaches and practices that can further support diverse talent development pipelines.
• Prepare for ongoing state- and federal-level engagement. Companies can ensure that their teams are equipped to monitor and support with amicus briefs to safeguard human resources initiatives, DEI programs, and other corporate diversity efforts at lower-level federal and state courts before they bubble up to the higher courts. Furthermore, given state-level policy already targeting DEI programs with an intent to send a chilling message, companies should expect copycat efforts in future legislative sessions.  

As we saw with the fall of Roe v. Wade last year, the end of affirmative action is likely to encourage partisans and extremists to seek out a myriad of legal, policy, and media levers to create unrest across jurisdictions. The business community cannot afford to watch from the sidelines or be caught off-guard because of a lack of action or infrastructure to reinforce and protect long-term business strategy.

BSR’s Center for Business and Social Justice works with a network of civil society partners and experts in reproductive health to provide tangible guidance to business. All BSR members can contact the Center for specific inquiries.

Blog | Tuesday June 13, 2023

A Credible Future beyond Growth

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On May 15-17, BSR attended the three-day Beyond Growth conference, a multi-stakeholder event hosted at the European Parliament in Brussels. The first edition of the conference in 2018 gathered a low number of attendees. In 2023, the conference hall in European Parliament was full, with over 2,500 in-person attendees and 7,000 participants overall, including the President of the European Commission, Ursula Von Der Leyen, and the President of the European Parliament, Roberta Metsola.

At a time when the world is facing a polycrisis, the conference sessions were inspiring, filled with a sense of urgency and a remarkable determination for change. There was a collective understanding that the social, environmental, political, and economic crises are interrelated and that tackling them requires transformational policies and concrete action that address its root causes, rather than its periphery. Speakers highlighted the limitations of the current economic model in our era and that the decoupling of economic activities from natural resources use won’t happen at the pace and scale which is needed for the world to thrive within planetary boundaries.

In her inaugural speech, Ursula von der Leyen set the stage by referring to the 1972 Limits to Growth report and delivered a powerful message: “A growth model centered on fossil fuels is simply obsolete” and that “economic growth is not an end in itself. Growth must not destroy its foundations, but instead, serve people and future generations.
 

Key takeaways from the conference include:

• The current mainstream economic model based on growth contributes to environmental impacts, penalizes the poor and vulnerable, and fuels inequalities globally.
• We need different goals in 2023 and beyond. GDP growth is an indicator that is no longer fit for purpose and currently undermines social foundations and environmental limits. Our policies should rethink the place of growth as a means to an end, instead of a way of achieving a societal vision of prosperity, well-being, and care within planetary boundaries.
• Achieving this vision differs across geographies, activities, and time. The “post-growth” economy within planetary boundaries is a fair society, and the concept of sufficiency as defined by IPCC is central to this vision. It will have very different implications by sector (huge investments needed in some, and a reduction for others); geographies (recognizing that certain countries live well beyond the threshold of planetary boundaries, while others struggle to keep their citizens out of poverty); and time (with transition phases toward long-term vision).
• The alternative paradigm to our current economic model is not working. The main economic theory to reduce harm to the environment is environmental “decoupling.” Several studies prove that decoupling is not working fast enough, and the decoupling of economic activities from environmental indicators is not feasible. Speakers pointed to the fact that alternative models do not necessarily need to be created from scratch—they exist but are not regarded in the mainstream economy.
• We need to change the process, not just the goal. Vulnerable and marginalized communities have a limited voice in current decision-making structures. Giving such communities a place in the making of new policies and solutions is central to achieving a fairer and more sustainable society, and economy.
• The provision of credible and holistic alternatives is central to the transition. Working toward this vision is a transition—and such a transition should be accompanied. Policymakers have a fundamental role in shaping the right, credible policies that bring about a planned, co-created transition. For example, shared decision-making on the implications of the concept of sufficiency and on the right path forward is crucial.
• Civil society, academia, and business can advocate for change. While the conference showed a powerful flow of ideas and thinking from civil society and academia, EU policies are not fit for “beyond growth” thinking in Europe right now, and negative lobbying is impeding progress. All actors have a role to play to define and advocate for the right enabling policy environment to build a more just and sustainable world.

The conference covered a variety of subjects: reflections on fair wages and universal basic services to the just transition, the role of taxation as an instrument of social and environmental justice, the role of finance in a post-growth society, the impact of geopolitics of minerals in the green transition, the biophysical limits of our planet.  

We left after three days inspired by questions, thoughts, and ideas and committed to exploring how these can help us advance the BSR vision of “a world in which all people can thrive on a healthy planet" in our work with business to create a just and sustainable world.

It is very clear that “the hard work” starts now for Europe, and time will tell whether European institutions will draw learnings from this vision to shape the right policies that go beyond growth for growth’s sake. Doing so requires urgent action, courage to push for structural change, and an expansion of social dialogue.

It is also very clear that, while the right enabling policies are crucial, we will need forward-looking and credible action from businesses to work toward a balanced society within planetary boundaries. A thriving business within planetary boundaries will need to innovate to address the tension between traditional models and corporate sustainability goals, and our BSR team is ready to work alongside our members to do so.

People

Angela Spiridis

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Angela leads the operational performance for RISE, an initiative to support collaborative industry action at scale to advance gender quality in global garment, footwear, and home textiles supply chains. RISE’s mission is to empower women workers, embed gender equality in business practices, and catalyze systems change.

Angela has spent her career working for international NGOs focused on promoting gender equality, including for a leading sexual and reproductive health service provider. Angela has managed programs across the Asia and Africa regions and has lived and worked in Nigeria.

Angela holds an MBA from Toronto Metropolitan University, a Honours Bachelor of Commerce from McMaster University, and a PRINCE2 project management qualification. Angela speaks English and Greek.

People

Sreya Nath

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Sreya works on multiple RISE programs across global supply chains. She supports RISE Respect—Tackling GBVH, RISE Foundations, and RISE Women and Leadership programs. She is also responsible for assisting country leads in India and Bangladesh.  

Prior to BSR, Sreya worked as a gender consultant in different nonprofits and international organizations. She worked on an action-research project on socioeconomic inclusion of migrant and refugee women in the EU, focusing on Italy, France, Greece, and the UK, in collaboration with Women Forward International. She also worked as a graduate research assistant at Sciences Po MediaLab, where she investigated the gendered dimensions of immigrant discourse on Twitter.    

Sreya has a Master’s in International Development, with a specialization in Advanced Gender Studies from Sciences Po Paris. Originally from Calcutta, India, Sreya is a native Bengali speaker. She speaks English and Hindi fluently, and she speaks French at an intermediate level. 

People

Kristina Gonzales

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Kristina assists the Global Lead in managing contract negotiations and compliance monitoring for various project teams.  

Prior to working at BSR, Kristina worked in the legal industry. She handled various bankruptcy matters throughout the state of Texas, representing both debtors and creditors in federal court. She also worked in the insurance industry and handled claims throughout the United States.  

Kristina holds a Juris Doctor from the University of Houston Law Center and a BA in Philosophy from the University of Texas. 

Blog | Thursday June 8, 2023

Seven Lessons for the Just Energy Transition

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In 2022, BSR and The B Team launched Energy for a Just Transition (EJT), a business-led collaboration that brings companies and stakeholders together to help the energy and utilities sector plan for and implement a just, fair, and inclusive transition from a carbon-intensive economy to a net-zero GHG economy by 2050. The three-year collaboration provides a forum for discussion, knowledge sharing, and action.

Throughout our first year, we have learned various lessons about the challenges and opportunities of corporate action on the just transition in the energy sector:

1. Ambition matters, but it is not enough. The companies that are part of EJT have set net-zero ambitions, and most have made explicit just transition commitments. However, moving from ambition to action on a complex issue like just transition is not easy. Business must keep up with evolving definitions and stakeholder expectations, as well as maintain transparency on objectives and new challenges. It requires a careful and honest assessment of how and where a company is best positioned to act.
   
   It also calls for buy-in from the top, which translates to the appropriate support and resource allocation for implementation across the organization and its activities. Evolving corporate incentives and culture is essential to drive the right conversations and changes required to ensure coordination across various organizational layers, the supply chain, and multiple geographies. In the year since we started EJT, we do see that just transition has been further integrated into corporate strategies.
2. A cornerstone of the just transition is engaging in social dialogue, minimizing the impact of transition on workers, and maximizing opportunities for inclusion and continued access to good jobs. Last year, the collaboration engaged with worker representatives in challenging yet constructive conversations. A key learning was that more spaces for engagement between workers and company practitioners (including human resources, workforce planning, industrial relations, and stakeholder engagement teams) are needed to improve the mutual understanding of what the challenges, expectations, and possibilities are. While these informal discussion spaces do not substitute formal engagement processes like bipartite or tripartite negotiations, they can build and enrich social dialogue outcomes when actively sought out and entered into with transparency.
3. A significant obstacle to the effective implementation of just transition at the corporate level relates to the cross-functional nature of the challenge. Just transition requires an approach that is contrary to the traditional and often siloed approach to risk and impact management and opportunity realization processes in the energy industry. A just energy transition requires collaborative and coordinated thinking that goes beyond commercial and engineering-driven solutions. Some positive signals of change are emerging. As one member said: “Thanks to the just transition, our engineers are finally starting to understand why social aspects need to be an essential part of solutions design.”
4. No company can tackle the challenge alone. Just transition is about change that needs to happen “everywhere, all at once”—and it needs true systematic coordination. Collaboration can be tricky to “unlock.” It requires trust, aligned objectives, agreement on the problem, the right mandates and resources, and a certain appetite for risk. Adhering to antitrust laws is essential but should not be an excuse to stop exploring the right space for action. Several working groups have now been established to identify possible joint action in areas such as workforce transition, the supply chain, and project development.
5. “Transition out” is different from “transition in”—but the impacts are simultaneous. The “transition out” phase involves asset closure, decommissioning, divestment, or transformation and consideration of how to manage these responsibly whilst creating job opportunities and mitigating impact on surrounding communities. The “transition in” phase requires a strong commitment to respecting human rights and addressing social impacts when moving into the renewables space—including across the value chain—even as we aim to move at the fastest possible pace. Many companies find themselves participating in multiple transitions simultaneously—a situation that some are referring to as the “transition across,” since it requires them to take a holistic approach to manage the impacts of "transitioning in" and "transitioning out.”
6. A just transition is impossible without stakeholder engagement. Stakeholders affected by the transition include workers, communities, landowners, civil society and environmental groups, human rights defenders, investors, and governments at national and local levels amongst many others. The context of transition is one that demands fast implementation. Stakeholder engagement could be perceived as a time-consuming step in project development or closure, and there is a risk that engagement becomes a tick-the-box exercise for companies. This can result in frustration or fatigue by stakeholders. But engagement should be seen as an opportunity to codesign a more sustainable transition and to create more just outcomes. It should be a space for collaboration and coordination, to ensure the processes are valuable, effective, and impactful for everyone involved.
7. Corporate action on just transition without system change will not suffice. To accelerate the just transition, we need to change incentive structures and create an enabling policy environment to align economic incentives to redirect capital toward climate mitigation, ecological restoration, and social needs and opportunities. We need to mobilize significant investment to support economic diversification. The private sector has an important role in calling for the policy changes and incentives alignments that are required to ensure a just transition—and avoiding lobbying for or funding policies that are counter to the just transition.  A level playing field and a supportive environment, created through policy and regulation, will stimulate increased corporate uptake and implementation of the just transition.

After one year of EJT, we know that much remains to be done! Energy companies can and must work collaboratively, participate in, and support initiatives that enable a worker- and community-centered transition to a net-zero economy. Get in touch if you want to learn more about how you can support your company, lead in this changing environment, and advance the just transition.

People

Elisa Estrada Holteng

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