CTPs – the way ahead for business

Ambition: We have divided our goals into long-term targets and near-term targets: from becoming net-zero by 2040, to a 50% reduction in absolute scope 1, 2, and 3 greenhouse emissions by 2030 (compared to the 2019 base year).

Action: From suppliers, logistics and operations to travel and commuting, product use phases, and end-of-life, we’ve looked at our emissions across the entire value chain and detailed the steps we can take to make significant change in each area. This includes incentivising suppliers to commit to renewable energy, electrification of the logistics fleet and last-mile distribution, and further extending the use of LED — the single biggest factor in reducing the lighting industry’s emissions.

Advocacy: Advocacy is a significant part of Signify’s Climate Transition Plan — which means working with like-minded organisations to drive policy change in crucial areas. To reach net-zero emissions, we need support from governments and businesses to collaborate with, to incentivize greater energy efficiency across our economies.

Accountability: As the world leader in lighting, it’s on us to step up and take accountability for our impact and inspire others to do the same. We’ve shifted our business toward more energy-efficient and longer-lasting LED lighting. We endeavour to manage this transition responsibly by ensuring that our products remain affordable.

There are increasing expectations from stakeholders on companies and organisations moving towards net zero. It is no longer enough to just set a science-based target — companies need to demonstrate how they can decarbonise their operations with a climate transition plan.

Demand for robust and credible climate transition plans has increased as more organisations make public net zero commitments, highlighting the push towards transparent, achievable planning in the business ambition for limiting global warming to 1.5 degrees Celsius above pre-industrial levels. A Climate Transition Plan (CTP) is a strategic summary of how businesses intend to transition to a sustainable economy and align their business operations with global climate goals, particularly the targets set by the Paris Agreement. They should also be viewed as an opportunity to add value and resilience to business planning and strategy by driving the internal shift towards low-carbon solutions.

The Climate Transition Plan set out Signify’s roadmap to net-zero. By 2040, we aim to reach net-zero and reduce absolute scope 1, 2 and 3 greenhouse gas emissions by 90% and eliminate the remaining 10% through carbon removals. One year into launching the plan, we have seen great progress.

-    Signify’s carbon footprint is 65% lower as compared to 2019 baseline year.

-    Last year, Signify reduced its year-on-year emissions by 42 per cent in our own operations — largely due to concerted efforts to cut natural gas consumption in its factories.

-    We have seen a consistent decline in carbon emissions across the board. Be it our suppliers, travel, use of lights - use phase or end of life, our own operations etc. We have seen increased engagement with suppliers and decrease in their emissions.
As a business, we have reduced our own carbon footprint. Be it from travel or from the use of natural gas used in our facilities. We also exploring options to increase the generation of renewable electricity, onsite.

-    We have seen a decrease in use phase (customers using Signify products) emissions. This has resulted from a focus on energy efficiency as well as connected LED lighting, which is helping our customers become more sustainable.

-    Our transition to a circular economy has led to a decrease in emissions in the end-of-life stage.

These are just some examples of a positive impact that we have made. We are by no means stopping here.

We are proud of our success, and we believe our progress so far could not have been possible without having an inward perspective and making changes. Here are a few measures we took:

-    Renewable energy plays a central role in Signify’s journey to net zero. 

A recent study by the We Mean Business Coalition showed that more than half of companies are prepared to relocate operations to have better access to renewable electricity. At Signify, we have created access to clean electricity where it did not exist. We were one of the first European companies to invest in power purchase agreements at scale. Today, these supply 47 per cent of our renewable electricity. Beyond sourcing renewables, Signify has begun electrifying its logistics fleet, introduced plant-based biofuels, and transitioned to electric and hybrid lease cars. Combined, these measures contributed to an emissions reduction of 505mn tonnes of carbon dioxide across our value chain since 2019, a 60 per cent decrease in all scopes. 

-    Forming the right collaborations

No single company can decarbonise in isolation. We are an active voice in encouraging governments to reduce emissions and incentivise greater energy efficiency across economies.

Together with the Climate Group Signify has co-authored a white paper on Unlocking Negawatts, showcasing how lighting can drive energy security and decarbonisation, is one recent example. We also participate in global forums such as COP and Climate Week, believing that advocacy is a powerful, often underused lever to progress on climate goals. We recently also announced the launch of Pineapple CoRE- a strategic collaboration
with Pineapple Partnerships, the systems change focused consultancy, and Schneider Electric, the leader in the digital transformation of energy management and automation. The collaboration aims to accelerate decarbonization across the commercial and industrial property sector. Initially focusing on the UK, the collaboration is scalable for global deployment. 

-    Energy efficiency for the win

The targets in Signify’s CTP are aligned with science. The company’s biggest source of emissions is in the use phase of its products (Scope 3), when lights are switched on by customers. Signify identified two critical actions to lower emissions: improving the energy efficiency of our lighting products and advocating for renewables to power them. Energy-efficient LED lighting now accounts for more than 90 per cent of our revenues, up 5 per cent year on year. The company continues to innovate in connected LED, which reduces energy consumption by around 80 per cent compared with incandescent lightbulbs. It also prioritises investment in ultra-efficient technology and in circular business models such as remanufacturing and light-as-a-service, rooted in the principles of “use less, use longer, use again”.

There is no debate on the role a CTP plays in an organisation operating in a sustainability first era. At Signify, we understand that with our leadership comes the responsibility for the way lighting impacts the environment around us. We must play our role in ensuring that the transformative power of light does not come at the expense of our planet.

Alice Steenland

Chief Strategy, Sustainability & Marketing Officer

Driven by the CTP, we are proud to share the progress so far and continue to march ahead, use our voice to engage our customers, employees, and public decision-makers on how to accelerate climate action, toward brighter lives and a better world.