ACT fact sheet
Accelerate Climate Transition
Type: Implementation and monitoring of the action plan / Evaluation
Date: 2015
Author: CDP and ADEME Target: Companies
The climate emergency and the growing integration of carbon accounting into the strategy of organisations show that it is essential to assess not only the GHG emissions of each organisation, but also their action plan.
In order to improve reporting on the action plan, and more generally, the energy-climate transition of organisations, it seems interesting to assess which strategy is implemented and to what extent this strategy is in alignment with low-carbon transition pathways (traced for example by the IPCC, the International Energy Agency (IEA) and the work of IDDRI).
It is with this objective in mind that a new method developed in 2015 by CDP and ADEME, initially named "Assessing low Carbon Transition" (ACTĀ®), was developed. To date, ACTĀ® is the only international initiative that creates a "climate accountability" framework for companies vis-Ć -vis the 2Ā°C objective of the Paris Agreement. ACTĀ® is divided into two components: "ACT Step by Step" and "ACT Assessment". The first makes it possible to build a strategy aligned with relevant and ambitious low-carbon pathways, while the second makes it possible to valorise it by assessing its credibility and robustness.
What are the objectives of the approach?
ACTĀ® aims to measure the alignment of an organisation with a future low-carbon world. These methods are carried out from a reference framework, which makes it possible to valorise strategies compatible with a low-carbon transition pathway. ACTĀ®, through its analysis, awards a rating intended to inform companies and investors, as well as indirectly public authorities, about the credibility of the low-carbon strategy. Through ACTĀ®, companies are assessed according to sectoral criteria, in accordance with the IEA's sectoralised 2Ā°C pathways.
What is (are) the target(s) of the approach?
"ACT Step by Step" and "ACT Assessment" are addressed to companies, investors, consulting firms, federations and to a lesser extent public authorities. To ensure their adaptability to organisations of different sizes, ADEME and CDP experimented with ACTĀ® methodologies on 23 large international companies and 30 French SMEs and mid-sized companies from the six major sectors of activity.
Today, there are 14 sectoral ACTĀ® methodologies for: automotive, electricity, retail, cement, transport, oil & gas, iron & steel, aluminium, pulp & paper, construction & property management, construction, glass, chemistry. A method qualified as "Generic" is applicable to a wide range of other sectors: mining, waste and water management, catering, information and communication, healthcare, entertainment, public administration...
A method qualified as "Generic" is applicable to a wide range of other sectors: mining, waste and water management, catering, information and communication, healthcare, entertainment, public administration...
It should be noted that the ACT "Generic" methodology differs from the sectoral ACTĀ® methods in its absence of a single reference framework due to the diversity of the activities of the assessed companies. Unlike sectoral methods that use emission intensity metrics based on physical units specific to each sector (such as tonnes of CO2e per tonne of cement), ACT "Generic" adopts a combination of strategies: use of mixed reference frameworks, choice among available sectoral reference frameworks, and, failing that, application of the Science Based Targets initiative (SBTi) absolute contraction approach to establish decarbonisation pathways.
Does the approach draw on a shared scientific basis?
ACTĀ® methods draw on work from, among others, the IEA, the SNBC, SBTi and IPCC reports.
They are based on the analysis of specific points of the company's strategy through 9 modules.
1) The target in terms of reduction objectives
2) material investments
3) intangible investments
4) management
5) the performance of products sold
6) engagement with suppliers
7) engagement with customers
8) political engagement
9) the business model
Each module is then composed of several indicators. These modules and indicators are weighted according to sectors. The weighting was developed to reflect the relative importance of the modules in the low-carbon transition of the various sectors.
Does the approach draw on a specific methodology?
The steps of the ACT "Step by Step" (or ACT-S) method are as follows:
1) Current situation / initial diagnosis
2) Issues and Challenges
3) Vision
4) New Strategy
5) Action Plan
In the case of an action for the climate, the action must be "ClimATE-SMART".
Clim = Climate impact: will the action lead to a low, medium or high reduction in GHG emissions?
A = Acceptable: is the behavioural change required by the action acceptable to the target stakeholders?
T = Transformative: will this action lead to some transformation of activities?
E = Engaging: will this action promote the buy-in of the target interested parties?
The steps of the ACT "Assessment" (or ACT-A) method are as follows:
1) Performance rating
2) Narrative rating
3) Trend rating
4) Feedback report
The ACTĀ® rating thus combines:
A score from 1 to 20 (Performance Rating)
A letter from A to E (Assessment Rating: the company is more or less well prepared for the transition towards a low-carbon economy)
A sign (Trend Rating: + (improvement), - (degradation) and = (stable))
For companies and in particular SMEs and mid-sized companies, ACTĀ® can therefore take the form of a method for structuring their low-carbon transition strategy, by indicating through its rating of different criteria, the points to prioritise to define and ensure the continuity of the organisation's strategy.
The boundary of ACTĀ® methodologies resembles an organisational boundary. However, it differs from that of GHG inventories, for which organisational boundaries are based on a control/ownership approach of GHG sources and sinks. The ACTĀ® boundary therefore potentially encompasses all the activities of a company and its entire value chain.
The temporal boundaries for a given sector are determined by the need for past, present and future information on the organisation. The degree of past information to include is determined by what is necessary to infer the pathway required for an appropriate assessment.
The methodologies aim to integrate all significant sources of direct and indirect emissions (including scopes 1, 2 and 3) in order to faithfully reflect a substantial share of the organisation's total emissions.
The declaration boundaries of ACTĀ® methods for a given sector are defined based on the main emission sources of that sector, following the principle of relevance. This leaves organisations some latitude to adapt these boundaries to their specific sector of activity. Each ACTĀ® method specifies a detailed list of emission sources to be taken into account, including those that are mandatory and those that are optional. For example, in the ACT "Generic" methodology, direct emissions from land use, land-use change and forestry (LULUCF) are considered optional.
ACTĀ® methodologies have expanded since their creation with the addition of new sectoral methodologies. Currently, the sectoral method on agriculture & agri-food as well as a new method on biodiversity issues are in the piloting phase and will shortly be integrated into the ACTĀ® methodology catalogue. Furthermore, a new ACT methodology dedicated to "Adaptation" has recently been developed and is the subject of a dedicated sheet.
Does the approach draw on tools?
Excel collection and rating methods and tools have been developed for each of the sectoral methods.
The ACT "Step by Step" method draws on two toolkits:
a Strategy toolkit (which includes 4 types of resources, notably a SWOT matrix to assess the strengths, weaknesses, opportunities and threats of the organisation's action plan)
a Carbon Performance toolkit (which consists of a main tool dedicated to defining and understanding carbon performance indicators)
Can other low-carbon transition methods and tools be used to achieve the objectives of this approach?
In order to be able to undertake ACTĀ® approaches, the organisation must have carried out at least one organisational GHG inventory in the last two years. They are thus part of a continuum following an assessment carried out using internationally recognised methods, such as ISO 14064-1, the GHG Protocol or the Bilan CarboneĀ®. ACTĀ® methods thus make it possible to start, or continue, a process of reflection on the transition plan in the form of concrete actions (reduction potential, definition of monitoring, pilot, resource needs, financing, stakeholders). The ultimate objective being to test the robustness and alignment of this plan with the objectives set at the Paris Agreement.
Other initiatives address the same issues as ACTĀ®, such as "The Transition Pathway Initiative", which uses public documentation to assess organisations, or SBTi methods. ACTĀ® has the advantage of being a sectoral, transparent and company-data-based (public or verifiable) approach.
Does it allow for third-party recognition? If so, in what way?
After several months of assessment, the organisation receives the following elements:
A detailed explanation of the information used for the assessment.
A summary of the results obtained.
Recommendations to improve its GHG emission reduction strategy and adopt good practices.
A list of consultants and assessors is proposed to support organisations in their ACT "Step by Step" and ACT "Assessment" approaches.
Please note that the result of the initial diagnosis from ACT "Step by Step" does not necessarily reflect the score obtained within the framework of ACT "Assessment". The organisation must undergo an audit specific to ACT "Assessment" to obtain the correct corresponding score.
Can this approach be harmonised with other international reference frameworks?
ACTĀ® versions have been developed internationally through local programmes, notably in Latin America through the ACT-DDP (ACT-Deep Decarbonisation Pathway) project and in Japan, with the aim of supporting the country's neutrality ambition.
In 2024, France represents Ā¼ of the organisations having undertaken an ACTĀ® approach.
The sheets from the Overview of carbon accounting methods and tools are the result of a synthesis work by the ABC. We welcome your feedback or questions via this form.
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