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New ‘net zero’ standards could transform the climate — unless they’re derailed

Few people watch international bodies that set standards, but the ISO’s ‘London Declaration’ could be a big deal.

- October 3, 2021

Most people probably do not pay much attention to international bodies such as the International Organization for Standardization (ISO). After all, setting global technical standards may seem like dull and esoteric work. But these standards can have big consequences.

Last week the ISO announced a process that could significantly shape the future of the climate — but only if the proposal avoids undue influence by polluters. Here’s how it might happen.

Why technical standards matter

ISO’s 24,000 technical standards cover issues as varied as food safety,information technology and carbon accounting. The rules are made by hundreds of expert committees representing national standard-setting bodies and are adopted directly by companies and industry associations. ISO rules are voluntary — but national regulations, corporate contracts and trade agreements often include these standards, giving these rules real teeth.

Last week’s “London Declaration” by the ISO commits its myriad expert committees to review all ISO standards to ensure they align with the Paris agreement on climate change. Separately, the ISO is also working to define a standard for “net zero” — reducing emissions and balancing the remaining emissions by purchasing “offsets” that remove carbon from the atmosphere to prevent further contributions to global warming. This standard is important, because a growing number of countries, regions, cities and states — along with hundreds of companies — have pledged to go net zero.

These technocratic standard-setting processes have the potential to write the Paris agreement goals into some of the most fundamental rules governing the global economy. Understanding whether this will happen requires an exploration of how standards have worked in the past.

Hard science, but soft rules

The concept of net zero is based on hard science: Radically reducing greenhouse gas emissions and permanently removing any residual carbon is the clearest path to stop further warming of the planet, a long-term goal enshrined in the Paris agreement’s Article 4.1.

But it is not always easy to translate hard science into specific rules. Critics note that some net-zero targets are little more than a pledge for an outcome far in the future, which will allow offsetting to substitute for actual decarbonization. One recent analysis, for instance, found that some producers of greenhouse gases have binding commitments and clear net-zero plans, while others strain credulity. For example, Canadian oil sands producers have formed a net-zero alliance that proposes business as usual in the near term, on the assumption that carbon-capture technologies will suddenly become available at scale in the future.

In response, a rapidly growing though piecemeal landscape of efforts seeks to govern what “net zero” actually means. Many are private, voluntary initiatives such as the Science Based Targets initiative or Cities Race to Zero. Some voluntary programs are orchestrated by international organizations, like the U.N.-convened Net-Zero Banking Alliance. Many of these activities are part of the United Nations’ Race to Zero campaign, which provides an overarching “meta standard,” defining a set of criteria for net zero reviewed by an independent Expert Peer Review Group. (Full disclosure: One of us serves as chair of that committee).

The ISO’s plans, therefore, could be a giant step toward harmonizing these piecemeal voluntary efforts, potentially linking them more closely to hard rules.

What makes standard-setting work?

Net zero is a relatively new concept, but there is a long history of creating private and hybrid rules and institutions to manage environmental and social problems in areas such as forestry, fisheries, labor standards, human rights, conflict minerals and greenhouse gas accounting.

Social scientists have examined the complex politics beneath these standards and rules and suggest that their robustness depends on three main factors: rules on participation and transparency, connections to governmental authority and interactions among different standards.

The strength of a standard will depend on who participates in making it. Well-organized groups are more likely to develop a clear position and gain a seat at the table. Yet this can give rise to regulatory capture, where standards favor those they purport to regulate. For example, the first private forestry standard, the Forest Stewardship Council (FSC), gives nongovernmental organizations and industry equal weight. In response, industry groups created their own standard, the Program for the Endorsement of Forest Certification (PEFC). Unsurprisingly, it is less stringent.

Connections to governmental authority are also important. For example, the 2016 global aviation emissions agreement, CORSIA, now accepts offsets from the voluntary carbon market to meet reduction requirements, despite concerns about the reductions that these voluntary offsets produce. Government recognition can lock in low-quality standards, but it can also drive more-demanding rules. The European Union’s Forest Law Enforcement, Governance and Trade initiative, for example, prompted the FSC and PEFC to ratchet up their standards to meet E.U. regulatory requirements.

But as standards interact and compete with each other, their overall impact may become weaker. The creation of the PEFC ultimately limited the impact of the FSC, which has struggled to capture significant market share. When multiple standards compete, the consequences of any one standard for behavior are reduced, since those who find the standard too stringent can easily defect to a less onerous one.

Net zero is becoming a firm goal

Net zero is gradually shifting toward a mandatory goal in many parts of the world. U.K. government procurement contracts now require companies to have net-zero commitments, while Spain requires large companies to report net-zero targets and plans every five years. U.S. and E.U. financial regulators are moving to require companies to disclose climate-related risks.

On top of this, an emerging wave of litigation is forcing countries and companies to adopt or improve net-zero targets. For example, a Dutch court recently ruled that Shell’s net-zero target was inadequate and ordered the company to increase its short-term emissions-reduction targets.

Counterintuitively, the shift to binding regulations does not diminish the importance of private and voluntary standards, as governments often import the substance of such rules into new regulations and rulings. Because ISO standards have long been particularly influential throughout so many global industries, international rules and national regulations, the London Declaration opens a major new front in the push to translate climate science into binding outcomes.

Jessica F. Green (@greenprofgreen) is an associate professor in the department of political science and School of the Environment at the University of Toronto.

Thomas Hale (@thomasnhale) is an associate professor in global public policy at the Blavatnik School of Government, University of Oxford.