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Sustainability

Sustainability

Helping businesses, investors, and governments capture opportunities,
transform operations, manage risk, and drive growth
in an orderly transition to a low-carbon, sustainable economy

After more than ten thousand years of remarkable stability—the full span of human civilization—the earth’s climate is changing. The impacts of climate change, such as heat, inundation, pollution, and acute weather events threaten the global economy and local communities. The need to drive rapid decarbonization and reduce waste across production systems is sharper than ever.

Climate change requires policy makers and business leaders to embrace risk management while accelerating both adaptation and decarbonization. All key business decisions need to be examined through the lens of a continuously changing climate.

McKinsey works with clients to create Change that Matters, developing and implementing sustainability strategies based on our extensive sustainability expertise, deep industry knowledge, capital markets expertise, front-line operating experience, and a proven ability to drive organizational transformation.

We work in four main ways to deliver extraordinary impact for our clients and the planet: 

Identify and capture opportunities

Finding pathways to decarbonization, and defining concrete plans to achieve it

Growing new sustainable products and businesses in large growth sustainable markets

Restructuring portfolios to increase exposure to high-value sustainable market positions and reducing risk exposure

Reduce risks

Using proprietary tools and methodologies to assess physical and transition risk

Developing adaptation and resiliency responses to physical risks

Decarbonizing to net zero emissions by 2050 across the economy, managing regulatory changes, adopting rapid technology innovation, and adapting to shifting demand for products

Transform operations and supply chains

Driving operational transformations, based on resource intensity, including changes to governance processes, supply chains, and investment priorities

Implementing circular-economy principles to support sustainable growth

Raise and reallocate capital

Developing compelling capital development programs for resiliency and sustainable innovation

Leveraging sustainability strategies to drive value creation

Creating new financial products and strategies focused on sustainable investing

Realigning credit policies and capital allocation practices to capture opportunities and reduce risk

 

>1,700

projects in the past 3 years

>600

clients served across ~70 countries

>330

colleagues with deep expertise and diverse backgrounds

Examples of our work

McKinsey has extensive experience in helping businesses, governments, and nongovernmental organizations across sectors define and realize their sustainability goals.

An Eastern European city tackles carbon abatement

We worked with a major city to identify a potential abatement of 2.5 million tons or more of CO2 equivalent per year by 2030 to help it reach ambitious targets to reduce greenhouse-gas emissions. Our analysis determined the potential impact and cost of a range of abatement measures.

Finding alternatives to plastic packaging

For a multinational food company, we identified up to €200 million in annual savings from the use of more sustainable materials, focusing on the on the sustainability, cost, supply-and-demand dynamics, and recycling potential of alternatives to plastics.

Shifting from fossil fuels to green energy

We helped a European energy company create a profound shift in carbon emissions, with an 82 percent reduction in CO2 emissions as well as a positive impact on operating profit. To do this, we defined a strategy to shift from reliance on fossil fuels to 100 percent reliance on renewables by 2025.

Identifying opportunities related to climate change for a private-equity fund

We worked with a Scandinavian private-equity fund to investigate global sectors, identifying relevant trends, prioritizing investment themes, selecting subsectors—including US residential solar—and developing a list of investment targets.

More from this practice

McKinsey Center for Future Mobility

Brings together cross-functional expertise to deliver leading-edge insight to help shape the future of mobility-related industries and the public sector. We are passionate and curious about the emerging opportunities in mobility.

Featured capabilities

Energy Insights

A source of analytics, market insights, and performance benchmarking to help businesses and investors manage uncertainty and make effective decisions

ACRE

Data-driven decision making across the agriculture and food value chains

Knowledge partnerships

McKinsey works with leading institutions to develop distinctive thought leadership and convene partnerships that tackle problems that any one institution alone could not. We bring the best of our firm’s knowledge, expertise, and analysis to identify innovative solutions.

Building a circular economy with the Ellen MacArthur Foundation

For several years, McKinsey has partnered with the Ellen MacArthur Foundation to build a fact base on the economic and environmental benefits of a circular economy. This work has resulted in three recent publications: The circular economy opportunity for urban and industrial innovation in China, “A new textiles economy: Redesigning fashion’s future,” and The new plastics economy: Rethinking the future of plastics.

Establishing a framework for fostering effective energy transitions with the World Economic Forum

We have partnered with World Economic Forum (WEF) on scaling sustainability solutions across a number of sectors, including agriculture, energy, infrastructure, and mobility. For example, during a three-year knowledge partnership with WEF, McKinsey analyzed the performance of 114 countries’ energy systems and their readiness for a transition to a lower-carbon future. The work resulted in a new methodology, an open-access tool, and the report Fostering effective energy transition: A fact-based framework to support decision-making. We also partnered with WEF to provide analytical support for a vision for a sustainable battery value chain to unlock the full potential to power sustainable development and climate-change mitigation and are part of the WEF-supported Coalition for Climate Resilient Investment.

Featured Insights

Report - McKinsey Global Institute

Climate risk and response: Physical hazards and socioeconomic impacts

– How could Earth’s changing climate impact socioeconomic systems across the world in the next three decades? A yearlong, cross-disciplinary research effort at McKinsey & Company provides some answers.
Article - McKinsey Quarterly

Climate math: What a 1.5-degree pathway would take

– Decarbonizing global business at scale is achievable, but the math is daunting.
Article - McKinsey Global Institute

Reduced dividends on natural capital?

– The world’s stock of natural resources performs a range of services that are essential to human well-being. But climate change... is accelerating the depletion of natural capital.
Article - McKinsey Global Institute

Will mortgages and markets stay afloat in Florida?

– Flood risk is rising in Florida due to climate change. How exposed is residential real estate—both directly and indirectly—and... what can be done to manage the risks?
Interview - McKinsey Quarterly

‘Bring the problem forward’: Larry Fink on climate risk

– The physical impact of climate change will lead to a major capital reallocation, says the head of BlackRock, the world’s largest... asset manager.
Article - McKinsey Quarterly

Driving CO2 emissions to zero (and beyond) with carbon capture, use, and storage

– Any pathway to mitigate climate change requires the rapid reduction of CO2 emissions and negative-emissions technologies... to cut atmospheric concentrations. Technology and regulation will be the key.
Article

Banking imperatives for managing climate risk

– More than regulatory pressure is driving banks to manage climate risk. Financing a green agenda is also a commercial imperative—but... specialized skills are needed to protect balance sheets.
Report

Reducing agriculture emissions through improved farming practices

– A marginal abatement cost curve offers a perspective on how 25 proven GHG-efficient farming technologies and practices could reduce... emissions by about 20 percent by 2050.

Global Energy Perspective: Accelerated Transition

Our outlook reviews eight potential shifts that could accelerate the energy transition—from faster uptake of electric vehicles... to accelerated cost reduction for renewables—and the impact each shift could have on annual oil, gas, coal, and power demand to 2050.

About Us

Change that Matters

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