Are you wondering how your business stacks up against others when it comes to its carbon footprint? Climate impact is one thing, but it’s the energy crisis which has taken centre stage and now everyone – SMEs and larger businesses alike – are facing up to the challenge. Perhaps your clients are demanding to know?
Most business owners care about reducing their emissions and thus their environmental or carbon footprint, but what exactly is a carbon footprint, why should you reduce it, and how? In this article, we answer these questions and explore the unexpected difficulties and different approaches to getting the answers.
First, let’s clear up a major misconception: your carbon footprint calculation is really a measure of your production of greenhouse gasses, (GHG). These include carbon dioxide, (CO2), but extend to methane, ozone, nitrous oxide, and others too. Your ‘footprint’ refers to the quantity of gasses produced by an activity, such as heating your offices, or driving. Using various calculators, we then express the GHGs in Kilograms of CO2. When you see a figure such as “18 Kg CO2e”, the ‘e’ is telling you it’s the ‘carbon equivalent’.
Yes, but generally only for larger organisations of 250 employees or more and turnover above £36m. These fall under the UK government Streamlined Energy and Carbon Reporting (SECR) regulation.
The problem for smaller businesses, no matter whether you’re a manufacturer, a builder, or a lawyer, your emissions effect the carbon footprint of your clients! It’s the supply chain rather than regulation, which is demanding sustainable business practices. Your methodology, activity data, and the basis of your calculations are all subject to examination.
It was the famous Peter Drucker who said, “if you can’t measure it, you can’t manage it”, and so it is with any cost reduction exercise. You must detail all major forms of energy used, and through which activities. Waste causes emissions, and it too must be quantified.
As you dig deeper into any business, large or small, you discover emissions at every turn. Let’s focus on the basics: for example, if one mile driven generates 243g of CO2, the impact of eliminating 36,000 miles of driving is 8,748 Kg – that’s 8.7 tonnes – of CO2 saved. In purely financial terms, the business saved £7,200 at 2021 prices.
Our client, Advanced UK (Uxbridge, West London) did exactly that by developing the technology to service their client’s office printers remotely, more than 50 percent of the time. With an eight metric tonne carbon footprint reduction they’ve not only saved money, but they’re on their way to becoming carbon neutral which is precisely what their stakeholders (employees and commercial clients) are expecting!
You will find many spreadsheet templates, but it’s a recipe to see you tied in knots. The topic terminology is quite opaque, and learning carries a hefty time commitment. Remember too, this this is a continual monthly exercise, and not a one-off.
You’ll need to know which indirect emissions to include and determine if carbon neutrality is suitable for your company. Does your small business understand emission factors, and will your finance team tolerate another task?
A calculator to determine your greenhouse gas business carbon footprint is only the first step. You must develop a sustainability strategy (action plan) which reflects the expectations of new and existing customers, your budget, the impact upon your operations, and how a reduction in both energy consumption and waste will generate cost savings.
As to carbon neutrality, don’t be misled in thinking that any business can certify you. There are very precise standards and verification is paramount if you don’t want to face questions from the Advertising Standards Agency and other regulatory bodies. Demand verification to BSi PAS2060:2014.
A subscription service relieves your staff of the effort in generating your monthly carbon footprint data. The best will offer a choice between in-house software or a fully managed service, which can scale to meet the needs of your business.
Your provider should offer reporting, strategy planning, carbon offsetting, and BSi verification too. Remember also to capitalise on this work by including your footprint and action plan in your Environmental, Social, and Governance (ESG) report.
At ESG PRO, we’re always happy to share our experience, and we specialise in simplifying the the complex. Perhaps you’d like to have a thirty-minute consultation?
Natashia graduated Magna Cum Laude from the University of Illinois, has worked as the head teacher at an international school, and is now completing a Master’s in law to become a qualified solicitor. Her chosen speciality is environmental law, and it’s her specialist skills which keep us abreast of matters in a fast-changing world.
I hope you enjoy reading this article.
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