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The ACT method, which stands for Accelerate Climate Transition (formerly Assessing Low Carbon Transition), has become an international reference in supporting companies that wish to decarbonize their activities and contribute to carbon neutrality at the global level.
Its initial vocation, through ACT Pas-à-Pas and ACT Évaluation, is to guide companies in implementing the most effective action plans to reduce their greenhouse gas emissions.
Its new methodologies, ACT Adaptation and ACT Biodiversity, now extend its field of expertise to climate issues more generally, justifying the recent change in the meaning of its acronym.
Focus on an initiative whose recognized pedagogical approach is winning over more and more companies around the world.
What is the ACT (Assessing low Carbon Transition®) initiative?
Created in 2015 on the initiative of ADEME, the Carbon Disclosure Project (CDP) and the World Benchmarking Alliance (WBA), the ACT initiative has helped more than a thousand companies in their decarbonization process. It is part of the Global Climate Action Agenda set up by the United Nations, and is supported by the French government.
Particularly used in France, its country of origin, it is now spreading internationally, notably in Japan and Latin America.
The original aim of the ACT program was to establish a methodology for assessing companies' commitment to reducing their GHG emissions. Today, the program has expanded beyond simple assessment.
The ACT initiative currently comprises 3 programs:
- ACT Step-by-step guide to help companies build their decarbonization plan
- ACT Evaluation to assess the results of its climate strategy and identify areas for improvement
- ACT Adaptation, the latest addition to the initiative, to help companies adapt their activities to the consequences of climate change.
ACT: a sector-based methodology
The ACT Initiative is designed to be universal, supporting all private-sector players, whether large groups or small businesses, whatever their location or sector of activity.
To this end, it has set up specific methodologies for business sectors considered to be priorities in the implementation of a decarbonization trajectory:
- The automobile
- Electricity
- Distribution
- Cement
- Transport
- Oil and gas
- Construction
- Real estate
- Real estate development
- Iron and steel
- Aluminium
- Paper and pulp
- The glass
- Chemistry
A generic method will be developed to support other sectors, notably mining, industry, services, water management and waste management.
Three sector-specific methodologies are currently being tested:
- Agriculture and food processing
- The banking sector
- The financial sector
All about ACT Step by Step
ACT Step by Step is a methodology designed to help companies structure and implement their decarbonization strategy. It is designed to help companies prepare for the ACT assessment, but does not guarantee a good rating, which depends solely on the company's long-term efforts.
What are the objectives of ACT Step by Step?
ACT Step by Step has two main objectives:
- Ensure that the company makes an active contribution to mitigating global warming by reducing its direct and indirect GHG emissions as far as possible along its entire value chain.
- Accompany the company in its transformation towards a low-carbon world. This involves identifying the factors that will have an impact on its development as part of this transition, and helping it to take these factors into account in drawing up its corporate and climate strategies.
How is ACT Step by Step organized?
ACT Pas-à-Pas is a 2-year process comprising 4 strategic levels, 5 stages and 3 checkpoints. At each stage, the organization can draw on specific decision-making tools to formalize its analysis and feedback.
The five stages that make up the ACT Step by Step methodology should enable the company to begin its low-carbon transition. They are as follows:
- Current situation: the aim is to carry out an initial diagnosis of the maturity of the organization's decarbonization strategy and the actions already undertaken.
- Issues and challenges: using a SWOT matrix, the company will analyze its strengths and weaknesses in the context of the transition to a low-carbon world, identify its performance indicators and associated reference trajectories, and assess its current performance in relation to the objectives set. This stage also includes a training phase for Board members on climate issues.
- Vision: the aim here is to develop a vision of the company in a low-carbon world, and to establish a roadmap for achieving it. This stage requires formal approval of the vision by the company's Board of Directors.
- New strategy: the company will have to set new objectives and implement a strategic plan to achieve them. The Board of Directors will have to formally approve these objectives and strategic plan.
- Action plan: in this final stage, the company must identify and implement concrete actions to implement its decarbonization strategy, and monitor the results of this action plan.
The ACT Step-by-Step program integrates these 5 steps into 4 strategic corporate levels:
- Governance: the company's governance processes with regard to carbon strategy.
- Strategy: measuring the actual and potential impacts of a low-carbon society on the company's business from both an operational and a financial point of view.
- Managing the low-carbon transition: the processes put in place by the company to make the transition to a low-carbon world.
- Indicators and objectives: the targets it has set itself and relevant measurement tools for assessing its decarbonization strategy.
The table below gives a clearer idea of how these 4 strategic levels are structured in each step of the ACT Step by Step methodology.
Along the way, various checkpoints validate the company's commitment and enable it to move on to the next stages. They are also the sine qua non for the ACT Initiative to authorize the company to publicly communicate its progress in the ACT Step by Step Program.
Companies have a limited time in which to validate each of these points.
- Commitment: this checkpoint is validated at the end of the first 4 stages of the ACT Step by Step methodology. It validates the commitment of the company and its management to the project.
- Commitment: this checkpoint takes place during step 5. It must validate the concrete commitment of the company and its management to its decarbonization strategy, as well as the definition of GHG emission reduction targets.
- Actions taken: also located at step 5, this final checkpoint validates the implementation of the action plan to which the company has committed.
To participate in the ACT Step by Step program, at least one person in the company must have completed and validated the ADEME training program dedicated to this methodology.
However, it is also strongly recommended to have the approval of the company's Board of Directors, or even that the project owner is a member of the Board of Directors, and that the company has already carried out an initial Bilan Carbone within the last two years.
The project team should include the project leader, a coordinator and a team representing the company's main business units. Depending on the company's size and specific characteristics, it may also call on specialist consultants trained in ACT Step by Step methodology, as well as external stakeholders who can actively contribute to the smooth running of the program.
Understanding ACT Evaluation
ACT Evaluation is the original program of the ACT Initiative. As its name suggests, it is a process for evaluating a company's decarbonization strategy. It takes place over a period of 5 months, and is carried out by independent third parties to ensure the transparency of the process.
How does the assessment process work?
Companies are asked 5 key questions to assess their level of commitment, their credibility in the fight against global warming, and the extent to which their current strategy is in line with the objectives they have set themselves. Answers to these questions must include both quantitative and qualitative elements.
They provide a comprehensive overview of the company's history of commitment to the climate, its current decarbonization actions and the objectives it has set for the future.
The 5 questions asked in the ACT evaluation are as follows:
- Objectives: What are the company's objectives?
- Transition plan: How does the company intend to achieve them?
- Present: What is the company currently doing?
- Heritage: What is the company's recent stock history?
- Coherence: What is the overall coherence of these actions and objectives?
It is essential to have carried out an assessment of your company's greenhouse gas emissions beforehand. For this exercise, the ACT Initiative uses the methodologies of the GHG Protocol and ISO 14 064.
How does ACT Evaluation work?
ACT Evaluation's rating takes into account three scores, which are ultimately used to assign a grade to the company:
- The performance score is rated from 1 to 20
- The consistency score, rated from A to E
- The trend score, which is more specific. A "+" means an improvement, a "-" a deterioration and an "=" a stable state.
So the best score would be 20/A/+ and the worst 1/E/-.
The performance score is based on an analysis of 9 modules:
- Objectives
- Hardware investment
- Non-material investment
- Product performance
- Management
- The suppliers
- Our customers
- Commitment policy
- The business model
The consistency score is based on the answers also given in this first analysis. They should enable the evaluator to ensure that the actions undertaken by the organization are consistent with its commitments and objectives. To this end, it is based primarily on :
- Business model and strategy
- The coherence and credibility of the actions implemented
- The organization's reputation
- Risks facing the company
Finally, the trend score is based on the same answers, and is designed to assess potential changes in the company's decarbonization strategy and related results. It is based in particular on :
- Probable trends in GHG emissions
- Expected evolution of business model and strategy
ACT Adaptation - a new methodology to help companies build their resilience to climate change
The latest addition to the ACT Initiative, ACT Adaptation is designed to assess companies' ability to adapt to the consequences of climate change and the transition to a low-carbon world.
This new methodology was born of the realization that, even if we manage to limit global warming to 1.5°C by reaching the target set by the Paris Agreements, it is already having, and will continue to have, an impact on our environment and lifestyles. It is therefore important for companies to anticipate these changes as far as possible.
This analysis is based on 3 main dimensions:
- corporate governance and strategy
- the climatic and physical risks it faces
- its ability to adapt and take action
18 indicators within 9 analysis modules are studied to measure the company's ability to adapt.
Each indicator is evaluated according to the company's maturity on the subject. Evaluation levels are associated with a score:
- Basic (0)
- Standard (0.25)
- Advanced (0.5)
- Practice mastered (0.75)
- Best fitting practice (1)
The final score is then broken down according to the 3 dimensions and, via an arithmetic average, given out of 20.
At the end of the analysis, the assessor will provide the company with an assessment of its current degree of adaptation, and a list of recommendations for improving its processes and therefore its score.
How can the ACT method help you structure your low-carbon strategy?
The ACT method provides a structured, methodological framework to help companies develop an ambitious, credible low-carbon strategy. It also makes it possible to monitor progress and communicate on the actions implemented.
This is both a way of rewarding companies that have taken concrete action to reduce their carbon footprint and set themselves ambitious targets in line with those of the Paris Agreements, and a means of supporting them in their ecological transition.
The Step by Step method enables companies not only to set clear, achievable targets, but also to identify the most relevant levers to reach them, and thus contribute to global carbon neutrality.
This methodological framework, supported by internationally recognized organizations, is designed to be accessible to all economic players, and can be adapted to the specific needs of each sector, to better tailor action plans to the requirements of each organization.
Where extra-financial reporting standards, such as the CDP rating, focus on the disclosure and transparency of environmental information, the ACT method acts much further upstream, pushing directly for concrete action.
Sources :
- "Assessing low-Carbon Transition: Generic", ACT Initiative, December 2023
- "With ACT Adaptation, ADEME helps companies adapt"ADEME, 27/11/2023
- "ACT method: definition, method, interests", Selectra, 07/28/2023
- "ACT Adaptation methodologyACT Initiative, June 2022
- "ACT Step-by-Step: Development project results, 10/02/2021
- "ACT Step-by-Step: methodology", ACT Initiative, February 2021
