Opinion
Forget net zero. We need ‘real zero’ – and these companies prove it’s profitable
Claire Snyder
ContributorWe see net zero emissions pledges everywhere, but only 14 per cent of Australians actually understand what net zero means. Who could blame them? Since the Paris Agreement in 2015, the term “net zero” has been misused and misconstrued. This is largely because it was co-opted by the fossil fuel industry, which has exploited the “net” in net zero as a loophole to rely on carbon offsets rather than make genuine emissions reductions.
Three companies are actively trying to achieve “real zero” – Fortescue Mining, IKEA and Lendlease. Credit: Jamie Brown
Ultimately, net zero has become a benchmark for complacency, and it is failing us. If we want to maintain a liveable planet, we need businesses to commit to “real zero”. That isn’t a buzz phrase. It’s a climate goal that is exactly what it sounds like: phasing out fossil fuels to reach zero emissions as fast as possible without reliance on offsets – no asterisk and no “net”.
Why do we need it? The recent extension of the North West Shelf gas project in Western Australia is a classic example of how net zero enables greenwashing by fossil fuel companies – Woodside claims to be aiming for “net zero in our direct emissions by 2050″, while also expanding a fossil fuel project that is estimated to produce more emissions per year than those produced by Ireland. It does not even come close to passing the pub test, let alone a scientific assessment.
Net zero greenwashing is eroding public trust in climate action because it’s getting too hard to tell which companies are making genuine efforts to decarbonise, and which are not.
Climate Integrity, the organisation I lead, recently published a Real Zero Leadership report alongside the University of Technology Sydney, which names IKEA, Fortescue and Lendlease as real zero decarbonisation leaders. The intention was to provide Australia with north-star examples of genuine climate action that is happening right now, at a time when many global businesses are backsliding on commitments.
To be clear, Climate Integrity is a proudly not-for-profit climate advocacy organisation, which commissioned and funded this research independently of the 15-plus companies we assessed. We have received funding from none of them.
So, why Fortescue, IKEA and Lendlease? Because they’re all companies of a significant (and impactful) size, setting ambitious, science-based commitments to phase out fossil fuels earlier than 2050, without relying on carbon offsets. And because if they can do it, others can too.
So, what does real zero look like in the real world?
Fortescue is the only mining company in the world committed to phasing out fossil fuels. It’s already committed $US6.2 billion ($9.5 billion) to decarbonise its Pilbara operations and is exploring and developing newer technologies like green hydrogen, green ammonia, green shipping and green metals to power its mines in remote Australia by 100 per cent renewable energy. Fortescue is also using its massive political influence for good (rather than, say, pressuring the government into approving huge gas projects), actively lobbying for Australian climate policy in support of an economy-wide transition.
IKEA is the world’s largest furniture retailer, yet has made sustainability a central part of its business strategy – committing to halve emissions by 2030 and by at least 90 per cent by 2050. It has built these climate goals into its business plan, so all employees are motivated to achieve them equal to any other business goal. What does this look like in action? In an effort to eliminate fossil fuels from product materials, IKEA has expanded the use of bio-based glues, increased recycling for steel, aluminium, plastic, and is replacing fossil-based paraffin in candles with more diverse sources of vegetable-based waxes. It diverted more than 1 million products in Australia from landfill in 2024, through its Buy Back and Resell program. It recently installed a solar and battery system at its Marsden Park Distribution Centre, meaning 70 per cent of the site’s energy needs are now covered using clean, self-generated power.
Since 2016, IKEA has achieved an 89 per cent reduction in its operational climate footprint while growing revenue by 68 per cent globally, proving that rapid decarbonisation and commercial success can go hand in hand.
Lendlease is an ASX-listed construction and real estate company with listed revenues of $9.2 billion (2024) – it aims to completely phase out fossil fuels in construction by 2040. Its targets cover all aspects of its business activities: construction, development, investments and tenants’ emissions in all the countries it operates. It has already begun sourcing low-carbon building materials, like aluminium manufactured using hydropower, for its Sydney projects, cutting embodied carbon by up to 40 per cent. It has also committed to phasing out gas from the kitchens of new developments by 2030 and delivering electric retrofits of existing properties by 2040 at the latest. Importantly, Lendlease has enshrined its climate commitments as “whole of business” targets, which means this isn’t just the work of a sustainability team – every single employee, from the top down, is committed to achieving real zero.
Lendlease, Fortescue and IKEA are unlikely allies – sustainability leaders from completely different sectors that have landed on similar strategies. Rather than dismissing real zero as too hard or expensive, these companies are proof that it is possible – it’s already happening, and it is good for business.
We didn’t save the ozone by seeking to “offset” the impacts of harmful chemicals, while allowing them to continue being pumped into the atmosphere. Instead, governments and businesses agreed to immediate action to phase out CFCs. Now it’s time to do the same with fossil fuels.
Claire Snyder is the director of Climate Integrity, a not-for-profit advocacy group championing science, transparency, accountability and justice in corporate transitions to net zero.
Get a weekly wrap of views that will challenge, champion and inform your own. Sign up for our Opinion newsletter.