In addition to suppliers, customers and peers, heavy industry companies also interact with a wider network of stakeholders, such as public authorities (e.g. central governments, regional and local authorities), regulators (e.g. policy-makers, industry regulatory agency), financiers (e.g. public investment funds, private funds, banks), researchers (e.g. academics, public or private labs) and NGOs (e.g. specialist NGOs, business alliances, think- tanks). These organizations, classified in this report as “wider ecosystem stakeholders”, can also play prominent roles in the net zero transformation of industries. Public authorities and regulators can be incentivized by national net zero agendas, financiers by investor pressure to decarbonize portfolios, and researchers and NGOs by mandates to find and support new sustainable solutions. This common ground encourages new collaborations between heavy industry firms and wider ecosystem stakeholders, particularly related to technology, policy and regulation, carbon management and emission offsetting challenges.

Figure 16: Collaboration model types between wider ecosystem stakeholders

In addition to pushing their own R&D effort, heavy industry companies can collaborate with technology start-ups and research labs through private equity investments, incubation, research grants and joint facilities and teams to accelerate the technology readiness ²⁰³ of key solutions.

While not a silver bullet, policies and regulations can drastically improve the transformation business case of an industry and reduce first movers’ risk by supporting technology adoption, creating demand and enabling access to capital. Collaboration with public authorities and regulators through public-private advocacy groups can help companies co-design the pace and shape of their journey to net zero (Figure 16).

Moreover, significant emission reductions could be achieved today on many industrial sites, provided companies are equipped with adequate standards, processes and tools to manage emissions. Collaboration with specialist NGOs and technology service companies can help heavy industry firms achieve state-of-the-art emission measurement and monitoring and identify impactful actions with today’s available technologies.

Some heavy industry companies can reach zero Scope 1 and 2 emissions by fully electrifying their production processes and using renewable power (e.g. aluminium or ammonia industries). However, where structural long-term options are not available, some producers might rely on offsetting residual emissions to achieve net zero by 2050. Collaboration with specialist NGOs and offset providers can help companies secure the required certified offsets in the long run.

Explore Collaboration model examples between wider ecosystem stakeholders →

The changes required for heavy industry sectors to reach net zero are vast and will be transformative for these industries. These changes will require not only new models of collaboration, like the ones presented in this report, but also a whole new level of collaboration across all stakeholder groups – a step change in collaborative activity.

Companies will have to enter into new collaboration with their suppliers and customers, with their industry peers and with their wider ecosystem. Indeed, when truly disruptive technologies are created, the risk-taking and commitment required are too great for a company to bear alone. Industry companies’ innovative power and longstanding expertise will be key to the decarbonization challenge, but they will need their ecosystem to create the enabling environment, to jump-start demand and to create the financial conditions necessary to support private-sector innovation.

In addition, the boundaries of industries do not stop at national borders. International cooperation, including but not limited to groups like the G20, will be essential to pool risks and to create bigger markets for successful innovation and clean. new products. International cooperation will also be needed to remove regulatory barriers, provide credible policy support internationally, and create compatible standards or joint investment declarations. This must not only happen in advanced economies; importantly, emerging and developing economies poised to see the biggest increase in energy demand and GHG emissions are in dire need of investments, technological solutions and infrastructure to transition their energy systems. Collaboration across advanced and developing economies will need to play a key role to achieve this.

These changes cannot and will not happen purely “top-down” through governments’ orchestrated target setting or through industries’ applying
the right solutions independently. Public-private partnerships will be crucial, and the public sector will have an important role to play to provide the foundational capital or financial conditions necessary to encourage private-sector innovation.

In recent years, pioneer companies from the heavy industry sectors and their stakeholders have put great effort into exploring solutions to decarbonization choke points. Thanks to them, many inspiring “next generation” collaboration models already exist today. Other industry players can study, learn from, follow, improve, replicate these models in other geographies or industries, and invent more ambitious cooperation to progress the collective journey to net zero.