Green Transformation and Net Zero Mission New Step for Vietnamese Businesses

Amid the global shift toward achieving Net Zero by 2050, Vietnamese businesses are embracing great opportunities and challenges in their journey toward green transformation and sustainable development. Mr. Nguyen Quang Vinh, Vice President of the Vietnam Chamber of Commerce and Industry (VCCI) and Chairman of the Vietnam Business Council for Sustainable Development (VBCSD), shared insights on advancing toward a green future to the Vietnamese business community.

How would you assess the current state of Vietnamese enterprises in their efforts toward green transformation and achieving the Net Zero goal?

A positive sign is that Vietnamese businesses now have a significantly increased perception of sustainable development and green transformation compared to 5-10 years ago. Especially, leading firms have spearheaded substantial investments in sustainable business practices, aligning with the global trend toward achieving Net Zero by 2050.

For example, members of the Vietnam Business Council for Sustainable Development under the Vietnam Chamber of Commerce and Industry (VBCSD-VCCI) have effectively communicated the message of green growth and transformation both in their companies and across their value chains to their partners.

Vinamilk, Greenfeed, Traphaco, PAN Group, and other leading firms are very effectively applying green, clean low-emission business models, bringing circular elements deep into their production chains while creating sustainable livelihoods for disadvantaged communities through inclusive business models.

However, in the overall business community, there are still a lot of challenges in green transformation to businesses. According to the Report on "Readiness and difficulties of enterprises in green transformation" released by the Private Economic Development Board (Board IV) and submitted to the Government at the end of July, A large-scale survey of 2,734 companies showed that Vietnamese businesses encounter three challenges on their roadmap to emissions reduction and green transformation: securing working capital, acquiring skilled personnel, and identifying specific, suitable technical solutions.

Also according to the report, some respondents said that pioneering efforts in building factories and standardizing processes to meet international standards offer export advantages. However, the number of such companies remains limited due to insufficient information and the high costs associated with standardization. These barriers clearly need to be removed to open the green transformation path for the Vietnamese business community.

  Hosted by VBCSD-VCCI, the Vietnam Corporate Sustainability Forum (VCSF) is a key platform for dialogue on sustainability practices among state agencies, national and international partners, and the business community

What specific objectives will the Vietnam Corporate Sustainability Forum (VCSF) 2024 aim to address?

Vietnam has updated its Nationally Determined Contribution (NDC) to materialize its international commitments on emission reduction. At the same time, the Party and the Government issued national strategies toward green growth, necessitating the participation of all central and local agencies and sectors and promulgated specific decisions and decrees on greenhouse gas emission reduction and carbon market development among others.

However, given the existing challenges faced by the business community, concerns about achieving Net Zero goals are understandable. To strengthen trust and move toward realizing Net Zero goals as well as green transformation in general, we need to carry out a synchronous transformation with the stronger participation and joint actions of the Government, authorities, business community, investors, consumers and stakeholders. In this spirit, VCCI has chosen the theme for VCSF 2024 as “Net Zero 2050: Building Trust - Enabling Transformation.”

Through the forum, we aim to enhance awareness and encourage the business community to adopt a sustainable business mindset. We emphasize the role of Boards of Directors and senior executives in fostering and disseminating ESG-integrated leadership thinking. The forum will uphold the importance of human capital development in the sustainable business strategy in particular and the Net Zero goals in general. We encourage businesses to take stronger action by sharing successful green transformation initiatives from leading companies across various sectors. We provide updated information on Net Zero policies and directions for the business community. By doing so, we seek to strengthen the "public-private" partnership in the journey toward Net Zero 2050.

The VCCI’s Corporate Sustainability Index (CSI) not only measures corporate sustainability but also supports effective sustainable governance and enhances accountability for Vietnamese companies

Can you elaborate on the role of VCCI and the business community in advancing the Net Zero goal through innovation, comprehensive transformation, and multi-stakeholder collaboration?

Over the years, VCCI has collaborated with many central agencies and sectors to provide support for businesses, not only to open forums for exchanges and dialogues between businesses and relevant authorities to remove obstacles but also to share knowledge and experience on sustainable development models with businesses to seek the most suitable model, and VCSF is a typical example.

VCCI has also built and published different indices to promote sustainable transformation for different partners. For example, the Provincial Green Index (PGI) encourages provinces and cities in Vietnam to prioritize both economic development and environmental protection; or the Corporate Sustainability Index (CSI) stimulates the business community to adopt sustainable corporate governance, thus enhancing corporate competitiveness and transforming into responsible business. Currently, VCCI, through its VBCSD as a key catalyst, is also coordinating with IDH Vietnam to implement the Sustainable Industrial Parks Initiative in Vietnam, including the development and dissemination of the Sustainable Industrial Park Index (SIP Index). Once developed and finalized, the SIP Index will support industrial parks and local authorities in regularly assessing, monitoring, and implementing solutions to enhance the economic, environmental, social, and governance (EESG) sustainability of industrial parks and their tenants.

The efforts of VCCI or any organization will fall short of reaching their goals without the active support and strong commitment of businesses to sustainable development. In addition to financial resources, businesses themselves can create positive impacts on consumption trends, provide sustainable livelihoods for the community, conserve biodiversity and environmental resources with “nature-positive” business models, or support other companies in their value chains.

As a result, we are confident that the efforts of VCCI and the business community will be important “pieces” in the “picture” of a comprehensive transformation toward a green, equitable, and inclusive future.

Thank you very much!

Ms. Mai Kieu Lien CEO, Vietnam Dairy Products Joint Stock Company (Vinamilk) We recognize that the path to sustainable development is an ongoing journey that requires continuous effort and collaboration. To build a sustainable future for ourselves and future generations, we must unite with all stakeholders - suppliers, partners, customers and the community. Together, we can amplify a positive message within the business community and work in harmony with the government toward the critical goal of achieving net zero emissions. This journey is about creating a greener, more sustainable world. It's not a race, it's a shared responsibility in which every company has a unique role to play. Achieving net zero is not something we can do alone; it requires collective action. If there is a race, it's against time. As we embark on this journey, we will undoubtedly face unprecedented challenges. However, by learning from global best practices and leveraging technology, we can successfully navigate this transition. Most importantly, we are taking the first steps, no matter how small, toward a more sustainable future. For 48 years, Vinamilk has been committed to serving the long-term interests of the community. Business cycles may fluctuate, but sustainable development must be driven by a sense of responsibility and long-term commitment, rather than mere compliance. Ms. Do Hoang Anh Head of Corporate and External Affairs, British American Tobacco (BAT), East Asia Cluster At BAT Group, ‘Leading in Sustainability and Integrity’ has become one of its priorities to move toward a ‘Sustainable Future’. This obviously proves that sustainability is not a short-term tendency but an indispensable part of our long-term business growth strategies. BAT Vietnam has driven the sustainability agenda for many years with consistent strategies and practical initiatives to realize our ESG commitments. We acknowledge that climate change has become a crucial and urgent issue in Vietnam and worldwide. Therefore, we strive to mitigate the carbon footprint of our operations on the environment while creating more positive impact. To bring this to life, we have invested in decarbonization solutions such as renewable energy, and conducted sustainable farming practices in our supply chain. We have also driven carbon sequestration through the afforestation program with 124ha covered from 2022 to 2024. Besides, we commit to creating positive social impact by promoting diversity and inclusion within the company, enhancing livelihoods for farmers in the supply chain and for underrepresented women in the community. We take ethics and integrity as the principle in all activities. We guarantee to comply with the applicable laws, marketing regulations, Standards of Business Conduct, and Supplier Code of Conduct. These efforts enable BAT Vietnam to be recognized among the “Top 100 Sustainable Businesses in Vietnam” five times in 2017, 2018, 2021, 2022 and 2023 by VCCI-VBCSD, and motivate our team to continuously commit to the ESG agenda till 2025 and toward the next period 2025-2030.  Mr. Pawalit Ua-Amornwanit CEO, C.P. Vietnam Corporation (CPV) We are actively pursuing the Net Zero goal business across the Agro-industrial and Food business, aspiring to lead in sustainable development. Recognizing the profound impacts of climate change, we are dedicated to reducing greenhouse gas emissions through stringent emission controls and the optimization of production technologies. We have made significant investments in smart management systems and automation to control and reduce energy consumption, conserve natural resources, thereby minimizing emissions throughout the supply chain, and enhance production efficiency. We set up a sustainable production model with a closed-loop system aiming to achieve the vision of becoming the "Kitchen of the world." In addition to leveraging technology, we are actively engaged in research and development to create probiotic solutions that replace antibiotics with natural products, thereby reducing environmental and public health risks. CPV also works closely with partners and farmers to implement circular agriculture models that optimize resource use and reduce waste. These initiatives highlight our unwavering commitment to advancing the Net Zero goal in agribusiness, contributing to the development of a sustainable and environmentally friendly future. While the journey toward a low-carbon economy may present challenges, we remain steadfast in its pursuit of a solid and certain goal. Together with stakeholders, CPV is determined to continue driving the transition to a more sustainable world. Ms. Le Thi Hong Nhi Head of Communications, Corporate Affairs and Sustainability - Unilever Vietnam, Britcham Board Member & Chair of ESG Working Group Unilever has been at the forefront of achieving zero emissions in our operations since 2021, and has been prioritizing the building of a net-zero emissions value chain by 2039. This commitment aligns with the global push towards sustainability and the need to address climate change. By focusing on reducing greenhouse gas emissions and implementing sustainable practices, Unilever aims to make a practical contribution to national strategic goals for a sustainable future.

By Huong Ly, Vietnam Business Forum