From climate commitments to climate action
Most people and companies agree that there is no time to waste when it comes to the climate crisis - we need to act now. But with all the ambitious targets and big promises out there, what does action look like?
Cargotec’s sustainability work has focused heavily on climate. It’s where our biggest negative impact lies but also where our offering can be part of the solution.
“Greenhouse gas emissions from our own operations - things like assembly or energy use in our offices - represent about one percent of our total emissions,” says Henna Rautanen, Sustainability Director for Climate and Circularity at Cargotec. “So, we’ve put a lot of effort into understanding how we can reduce emissions where it matters most: during the use of our products. This is also where we can achieve profitable growth by helping solve our customers’ sustainability challenges.”
To support this ambition, climate targets are embedded in Cargotec’s new strategic performance targets. One is to reduce value chain emissions by at least 50 percent by 2030, which is in line with our science-based climate target. The other is to double the sales growth of our eco portfolio compared to traditional products.
But even ambitious targets are just targets. How are we going to get there?
Focusing on where it matters most
There is no silver bullet to magically cut emissions. Cargotec is working on many streams to do this, but one stands out: making sure our products help our customers reduce their emissions.
“The majority of our emissions comes from using diesel power to operate our equipment,” says Rautanen. “To reduce these emissions, we need to have an offering that is electric, low carbon and circular to the largest extent possible. These solutions are highlighted in our eco portfolio.”
The eco portfolio has two tasks: to reduce emissions for both Cargotec and our customers, and to drive growth by responding to an increasing demand for sustainable solutions. We updated the eco portfolio criteria in 2022 to cover two categories: climate solutions and circular solutions. After the update, the portfolio's climate solutions are aligned with the EU Taxonomy. The Taxonomy is a classification system that defines which business activities are considered environmentally sustainable by the EU.
“We wanted to turn these requirements into action through our eco portfolio,” Rautanen says. “We updated the eco portfolio criteria in 2022 to cover two categories: climate solutions and circular solutions. After the update, the portfolio's climate solutions are aligned with the EU Taxonomy. I think this is a great example of how regulation can drive true change while also providing great business opportunities.”
Action is the only option
As part of the criteria update, equipment and services that are considered for our eco portfolio must now demonstrate sufficient CO2 emission reductions. The requirements are aligned with the goal of the Paris Agreement to limit global warming to 1.5°C, and sufficient emission reductions for all portfolio equipment must be evidenced by an externally verified life cycle assessment (LCA).
“The LCAs prove the emission reductions that we promise, so that our customers can make a fact-based choice for the environment with a Cargotec eco portfolio product,” Rautanen says. ”But the LCA information is also valuable to us, as it helps us identify where to focus on when we further develop our solutions.”
The eco portfolio gives direction to Cargotec’s sales on what type of solutions should proactively be promoted to customers: the ones that help both customers and Cargotec achieve their sustainability targets. Sometimes, we may need to challenge our customers’ thinking and help them see the benefits of purchasing an eco portfolio product.
“We have chosen to set challenging targets for ourselves,” Rautanen says. “Achieving them and transforming our industry will take time, commitment and expertise, but we simply have no option but to take action now. It is imperative for mitigating climate change - and for securing our own competitive advantage in the long run.”