A Just Transition plan – or just a transition plan?

There is no single formula for approaching a Just Transition within your transition plan, but failing to incorporate the considerations of people will leave transition plans falling short. A business's impact on society and the environment is unique and context-dependent, meaning a Just Transition will look different for everyone.

The Transition Plan Taskforce (TPT) aims to support companies in creating holistic and robust transition plans. Its guidance does not prescribe a strict approach, allowing an organisation to consider its individual context. Despite these individual contexts, there are four foundational principles that can help align with the TPT guidance to support a truly Just Transition.

Just Transition principle one - Assess

The first step is to assess your business case by mapping your value chain. Organisations must consider the activities and elements that link together to create their value chain, accounting for the different contexts in which they are operate. Evaluating this allows for a unique perspective on how transitioning to a low-carbon economy may impact specific communities.

In the TPT’s guidance [1], the first recommended stage, ‘Baselining’, requires organisations to analyse the interdependencies between their climate action plan and the various stakeholders it may impact.

Assessing allows businesses to best focus their efforts on the areas of their value chain that are most in need of a Just Transition.

Just Transition principle two - Engage

Once you have assessed the risks, the next step is engaging with identified key and vulnerable stakeholders, to better understand where your business’ current plans could cause unintended impacts. A Just Transition prioritises these vulnerable stakeholders and requires organisations to put them at the centre of their transition plans. Phase 3 of the TPT guidance [1] outlines how companies are expected to explain how they will prioritise engage activities to maximise contributions. Approaches may include running upskilling programmes or stakeholder dialogue forums, or establishing funding schemes to support implementation of the plan. Supporting low-carbon initiatives not only within your direct operations but more widely in regions affected by decarbonisation is an example of how your organisation can facilitate change on a wider scale, guided by the Just Transition principles.

Engaging with stakeholders is central to a Just Transition to ensure that everyone has a voice in the plans that impact them.

Just Transition principle three - Act

With a well-crafted plan in place, it’s then time to execute. Companies should act by developing and executing a plan to amplify or introduce Just Transition elements into climate and business management processes.

TPT guidance [1] sets out a clear roadmap for companies to develop these plans and reiterates the need to consider the social impacts at each stage. Transition plans need to be quantifiable and accountable, so companies should set key performance indicators to measure performance, encourage engagement, and evolve the plan, appropriately collaborating with stakeholders. This could include targets for sustainable jobs generated through your Transition Plan, or metrics on funding dedicated to upskilling workers with skills needed for a low carbon economy.

Action is the only way to bring about a transition (both a Just Transition and a transition to Net-Zero). Setting simple metrics and targets will keep businesses accountable and drive positive impact.

Just Transition principle four - Amplify

TPT guidance [1] specifies engagement with government, public sector and civil society, as well as engagement with industry. This aligns with the need for companies to amplify their work and raise awareness amongst peers of the importance of a Just Transition. Businesses should centre vulnerable stakeholders when communicating and sharing best Just Transition practices. This could be via demonstrating a public commitment to the principles of a Just Transition through a formal policy position or an engagement strategy which partners with relevant workers and communities.

Advocate for mitigating the negative social impacts of the energy transition so all institutions can share knowledge and collectively enable a Just Transition.

The business case for planning for a Just Transition is a very simple one: it can help you manage a range of risks as well as create opportunities to enable a more engaged workforce, provide a pipeline of talent, strengthen reputation, maintain a social licence to operate and improve stakeholder engagement. To support organisations on their Just Transition journey, last year we published some advice on getting your business ready. For support on your Just Transition, please get in touch.

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References

[1] - https://transitiontaskforce.net/wp-content/uploads/2022/11/TPT-Implementation-Guidance-1.pdf