On Wednesday, fast-casual food chain Panera Bread announced that it plans to work towards a climate-positive business model by 2050. This means Panera will remove more carbon from the atmosphere than it emits each year. Climate positive suggests that it will go a step beyond the popular net-zero carbon emissions movement that has taken the business world by storm over the past two years with commitments from Unilever, Nestle, Verizon and many others.
"We passionately believe that carbon neutral by 2050 is just not enough," said Panera CEO Niren Chaudhary. "It’s good. But it's not enough given the severity of the crisis, and how much needs to be done. We need to elevate our ambition and hopefully, the industry collectively will also move towards climate positive, and not just neutrality."
The company announced its first climate commitments back in 2016. It aimed to reduce emissions by 15 percent by 2022 and has already achieved that goal a year early. Panera appears to be the first national fast-casual company in the U.S. to make the jump from a carbon-neutral commitment to a climate-positive one, but companies in other sectors were first movers with similar commitments. Intuit aims to reduce carbon emissions by 50 times more than its 2018 carbon footprint by 2030, and Microsoft plans to be carbon negative (another term for climate positive) by 2030.
Of course, companies that make physical products will have a tougher time going carbon negative than software companies. Companies with physical products have much longer supply chains, and must use energy to transport and create the products as well as sourcing the raw materials. The main source of emissions for most software companies is the energy for running data centers, which can be redirected to renewables. But unlike many software companies, Panera will be able to bring high-emitting suppliers including agriculture and transportation along in its journey to be climate positive.
We passionately believe that carbon neutral by 2050 is just not enough.
To get to climate positive, according to Panera, the company will need to remove 2.5 million metric tons of CO2 each year. Chaudhary explained that the company will first look towards reductions and then use offsets to cover the gaps and currently the company doesn’t have plans to address its historical emissions.
Panera is focusing on three key 2025 targets to reduce emissions: transition to 100 percent circular, reusable, recyclable or compostable packaging; using renewable energy for at least 50 percent of Panera Bread locations; and making 60 percent of its entrees menu Cool Food Meals. Cool Food is Panera’s own label developed with WRI that denotes meals made with ingredients that emit less than 5.38 kilograms of carbon dioxide per meal. As of late last year, the company already had 55 percent of its meals marked with a Cool Food badge.
On the packaging side, Panera is working on upping its compostable packaging and created an opt-out option for plastic cutlery for delivery customers. According to Chaudhary, this has reduced 125,000 pounds of plastic in three months. Panera will also work on optimizing its transportation fleet.
"The challenge that we will face is how do you do this reduction of the carbon footprint in a way that ends up strengthening the business model," Chaudhary said. "I think we'll be able to sustain these changes only if it is at no additional cost to the business model that we have because only then will it be something that we can continue to pursue for the long term. How do we manage this contradiction of being more efficient and more climate positive."