Glossary entry

Mitigation Hierarchy

Definitions

Option 1

Mitigation Hierarchy means the strategy developed by [the Company] to reduce its Scope 1, 2 and 3 Emissions by:

(a) using all [reasonable efforts] to prevent, avoid and reduce emissions from within its value chain;

(b) offsetting emissions only after making all achievable reductions in (a) above; and

(c) revising its strategy over time as more emissions are capable of being reduced.

Option 2

Mitigation Hierarchy means the strategy developed by [the Company] to reduce its environmental and social impact by:

(a) identifying all the [environmental and social] risks and impacts of [a Project];

(b) avoiding preventable risks and impacts;

(c) where avoidance is not possible, minimising risks and impacts as much as possible;

(d) where risks and impacts have been minimised, mitigating their effects;

(e) where significant risks and impacts remain, offsetting them if feasible; and

(f) revising its approach over time as more risks and impacts are capable of being avoided, minimised, mitigated and offset.

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Drafting notes

A mitigation hierarchy is a strategy to prioritise reducing value chain emissions before seeking to act beyond the value chain and offsetting them. It brings accountability and encourages organisations to consider the steps they can take to reduce emissions.

A strong mitigation hierarchy will set both near- and long-term Science-Based Targets. By adopting a mitigation hierarchy, organisations can work towards achieving the Paris Agreement Goals.

Option 2

A mitigation hierarchy can be used to address a wide range of environmental and social risks and impacts, as demonstrated by the definition in option 2. See A cross-sector guide for implementing the Mitigation Hierarchy and the World Bank’s standard on the Assessment and Management of Environmental and Social Risks and Impacts.

Just transition

In developing any kind of mitigation strategy, companies should consider the concept of a just transition to contextualise environmental and social action within a framework of social justice.

Disregarding social trade offs when implementing a mitigation hierarchy strategy may cause clashes with relevant government policy as well as supplier/ customer and local community rights and priorities.

Application

Corporate climate policies, supply chain agreements, finance documentation.