We can’t escape the fact that climate change is one of the biggest threats to the global economy, the environment, and the future of this planet. It is an enormous challenge and one we are committed to taking significant action on, making it a pivotal part of our overarching business strategy and how we approach markets.
The Intergovernmental Panel on Climate Change (IPCC) has made it very clear that if we are to reduce global warming, we have one chance, and this is the decade to act.
This means putting the right policies, infrastructure, and technologies in place to limit warming to around 1.5 degrees centigrade. We need to cut emissions by at least half by 2030 to achieve this. But, as the United Nations Intergovernmental Panel on Climate Change (IPCC) report highlights, it is extremely difficult to achieve this if no additional commitments are made or actions are taken. 2
Doing business responsibly to reduce climate change
We have been working hard to be carbon-neutral in our operations. We can proudly say we have achieved it yearly since 2020 through the Australian Government’s Climate Active Initiative, designed to encourage voluntary climate action. We want to enable renewable energy generation equivalent to 100 per cent of our consumption by 2025 . This fits in with the country’s pledge to increase the share of renewable energy in the National Electricity Market (NEM) to 82% by 2030.3
Telstra’s targets, span its global operations. We have made a commitment to reduce our absolute emissions by at least 50 per cent by 2030 across our scope 1, 2 and 3 emissions from a 2019 financial year baseline – and we are very much on track.
We are focusing on investing in renewable energy, improving energy efficiency, and decommissioning our older and more energy-intensive equipment. From a design perspective, our network and design teams are building emission requirements into the design of Telstra products. We continuously seek to improve how we create products and services, make them sustainable and inclusive, and sell them responsibly.
Our carbon footprint lies beyond our direct operations.
A recent report by JAC, a joint alliance on CSR for the telecoms industry, of which Telstra is an active member, highlights that most of the carbon footprint of companies in our industry goes way beyond our direct operations. If we are to get anywhere near the emissions reduction targets we have in mind, we must outline aspirational goals for our diverse global supply chains. As a result, 85% of JAC members now have Scope 3 reduction objectives in place, compared to just 31% of the world’s largest 2,000 companies.
More complex than scope 1 and 2 emissions, scope 3 are the indirect emissions from the activities we rely on to operate our business and provide products and services. These include the emissions made by our suppliers when manufacturing equipment that is installed in our network or products used by our customers such as the energy consumed by our products used in our customers’ premises.
We, like all the JAC members, know that our supply chain is a significant contributor to emissions, and to hit targets, we must work together to lessen our collective carbon footprint.
This year, we updated our sustainability strategy - to include 'protecting nature and biodiversity' and ‘enabling the transition for our customers' along with 'taking bold climate action' and 'progressing a circular economy'. We work closely with our suppliers to reduce the impact of climate change and enable a smooth transition to a low-carbon future.
This includes working with our people to make informed purchasing decisions and introducing environmental considerations into our source-to-contract process. We have also rolled out our climate change contract terms, including two key components: reducing absolute scope 1 and 2 emissions and upstream scope 3 emissions, in line with at least a 50% reduction by 2030 and supporting our suppliers in disclosing their emissions performance.
Our contractual terms are a leading indicator of sustainability performance, and we are fully aware that our suppliers are at different maturity levels when fulfilling them. They also provide us with an excellent opportunity to collaborate and share learning with our suppliers as we pursue the common goal of mitigating climate change.
We have partnered with the CDP through its Supply Chain Program to engage our suppliers to account for and address their climate change impacts more effectively. This program enables us to deliver training, tools, and support on environmental disclosures to over 400 suppliers. These disclosures help us to gain insights into our supplier emissions, identify reduction opportunities, and report progress against our own emission reduction goals.
We are also collaborating with suppliers to improve our use of resources, reduce waste going to landfills, and create innovative solutions to reduce our environmental impact across the lifecycle of our products. Enabling this collaboration, our finance team has established a central budget for us to fund emission reduction projects.
Doing better by our planet
At Telstra, we are committed to protecting our planet for future generations. As such, we are looking at all aspects of our business from a climate change perspective. Our suppliers undoubtedly play a vital role in this vision and achieving our climate change goals.
At Telstra, we are committed to our sustainability strategy, embedding it into business decision-making and monitoring our performance against measurable targets. For further information, click here.
1 IPCC The evidence is clear https://www.ipcc.ch/2022/04/04/ipcc-ar6-wgiii-pressrelease/
2 IPCC Longer report 2023 IPCC_AR6_SYR_LongerReport.pdf
3 Australia's Smart Energy Council https://smartenergy.org.au/articles/media-release-82-renewables-by-2030-smart-energy-council-welcomes-labors-powering-australia-plan/