What company progress towards a just transition means

Anna Triponel

March 29, 2021

Following the launch of its Just Transition framework in February 2021 (you can read our overview of the framework here) non-profit organisation the World Benchmarking Alliance (WBA) has published its draft methodology to assess 450 companies on their progress towards advancing a just climate transition alongside their efforts to reduce greenhouse gas emissions.

The methodology is now open for public comment until 14 May 2021, including an online survey and two multistakeholder roundtables. You can learn more about how to participate on WBA’s website here.

We’ve also summed up below some of the major themes and takeaways from the draft methodology:

Why a just transition matters: “Sustainable development can only be achieved by striking the right balance between economic, environmental and social components. The concept of a just transition, which strikes the right balance between the needs to decarbonise on the one hand and to respect the rights of workers and communities on the other, is relatively new and still evolving. Currently it can be understood somewhat differently by different actors, in terms of the expectations it sets for governments, companies, and other stakeholders.”

Global laws and standards back the just transition agenda:

  • The Paris Climate Agreement: “The ‘imperatives of a just transition of the workforce and the creation of decent work and quality jobs’ is referenced in the 2015 Paris Agreement, the international community’s commitment on climate change.”
  • International labour conventions: “Just transition is also addressed in 2015 Guidelines by the International Labour Organization (ILO), which aim to enable governments, workers and employers globally to ‘leverage the process of structural change towards a greener, low carbon economy, create decent jobs at a large scale, and promote social protection.”
  • The Sustainable Development Goals: “[T]he Sustainable Development Goals (SDGs) include multiple targets that together can achieve a just transition. The targets for promoting decent work for all (SDG 8) and combating climate change (SDG 13) are particularly relevant to this, in combination with the targets for:
  • implementing social protection systems (SDG 1.3)
  • ensuring healthy lives and promoting well-being (SDG 3)
  • increasing the number of youths and adults who have relevant skills for employment and decent jobs (SDG 4.4)
  • ending all forms of discrimination against all women and girls (SDG 5.1)
  • ensuring access to affordable, reliable, sustainable and modern energy for all (SDG 7)
  • upgrading infrastructure and retrofitting industries to make them sustainable (SDG 9.4)
  • adopting wage and social protection policies to achieve greater equality (SDG 10.4).”

WBA’s proposed methodology to assess companies on their progress towards a just transition

  • “The scope of WBA’s just transition methodology currently covers the companies in high emitting sectors in the scope of the Climate and Energy Benchmark. ‘Just transition’ can be used to refer to socially equitable transitions in other sectors. From 2022, the World Benchmarking Alliance (WBA) will integrate social criteria into all our benchmarks to ensure they represent transformations which ‘leave no one behind.’”
  • “In 2021, we will assess 180 companies in the oil and gas, electric utilities, and automotive manufacturing sectors on their decarbonisation performance and trajectories using the Assessing low-Carbon Transition (ACT) methodology.”
  • “Alongside these assessments, WBA will pilot ‘just transition assessments’, which will bring together ACT assessments, assessments with the recently launched core social indicators, as well as assessments with a new set of just transition indicators [see more on these below]. The development and rollout of these indicators, as well as the pilot just transition assessments, will enable WBA to refine our approach to integrating social indicators into a fully combined Climate and Energy Benchmark ranking from 2022.”

Draft just transition indicators

“The ACT methodology indicators and the Core Social Indicators are already settled. We are therefore presenting and consulting on the draft just transition indicators. These cover six key topics relating to a just decarbonisation and energy transition:”

  1. Planning for a just transition for workers and communities
  2. Social dialogue and stakeholder engagement
  3. Green and decent job creation
  4. Retaining and retraining/reskilling workers
  5. Social protection
  6. Advocacy for policies and regulation supporting a just transition

Read the full draft methodology report for details on each of the six proposed just transition indicators, including additional context and definitions: World Benchmarking Alliance, Assessing a Just Transition: Draft Methodology for Public Consultation (March 2021)

Source: World Benchmarking Alliance, Assessing a Just Transition: Draft Methodology for Public Consultation (March 2021)

You may also be interested in

This week’s latest resources, articles and summaries.