Building a corporate sustainability strategy is becoming increasingly important to all types of businesses.
From publicly traded companies looking to attract investors focused on environmental, social, and governance (ESG) factors, to startups aiming to engage customers with responsible practices, there are many reasons to focus on sustainability, beyond just helping the planet.
While you might set long-term goals around helping the environment, economy, and society as a whole, you don’t have to overhaul everything at once. Taking some action is better than no action.
So, if you want to start moving in the right direction, we’ll walk you through some concrete steps you can take to build the environmental pillar of your corporate sustainability strategy.
Calculate Your Carbon Footprint
Before you get too deep into identifying ways to improve environmental sustainability, it helps to identify your baseline emissions, i.e., your carbon footprint.
Calculating your corporate carbon footprint lets you see how much your business emits per year and what that’s equivalent to, such as the number of trees that would need to be planted to offset those emissions. That way, you can identify the size of your current impact and recognize areas ripe for improvement.
How Is a Corporate Carbon Footprint Calculated?
Figuring out how to calculate your carbon footprint has gotten easier, thanks to the emergence of online carbon footprint calculators from organizations like Terrapass. These calculators let you input a few facts about your business to automatically estimate your emissions.
What goes into these calculations? For the Terrapass calculator, we use the following fundamentals of a business’s carbon footprint, including:
- On-site energy usage
- Vehicle fleet
- Business travel
- Employee commutes
- Shipping
- Servers (which are the computers that work behind-the-scenes, such as to power your website)
Other factors, like putting reusable products in your office kitchen instead of disposables, make a difference too. But using a calculator that looks at the broad aforementioned factors can give you a good baseline to work with.
If you need a more detailed analysis, you can work directly with a Terrapass sustainability advisor to calculate your footprint.
Understand the Different Emissions Scopes
A carbon footprint calculator or footprinting analysis can help you understand your overall emissions. However, some organizations, like publicly traded companies, might separate emissions by their scopes, such as for reporting purposes.
The different emissions scopes include:
Scope 1 Emissions
Scope 1 emissions include direct emissions from company-owned or controlled assets, as the Greenhouse Gas Protocol explains. For example, if your business has a fleet of gas-powered vehicles, then the fuel you use for those would count toward Scope 1 emissions.
Scope 2 Emissions
Scope 2 emissions are indirect emissions that specifically apply to purchasing electricity, heat, steam, and cooling.
“Although scope 2 emissions physically occur at the facility where they are generated, they are accounted for in an organization’s GHG inventory because they are a result of the organization’s energy use,” explains the Environmental Protection Agency (EPA).
Scope 3 Emissions
Scope 3 emissions are all other indirect emissions. That can include emissions from business travel, for example. In that case, another company, e.g., an airline, is the one actually producing emissions. Yet many businesses still want to calculate these Scope 3 emissions, because their actions ultimately contribute to why the emissions were generated in the first place.
Scope 3 emissions can also include indirect areas such as supply chain operations and how customers ultimately use your products. In all, Scope 3 emissions account for 80% of emissions at many companies, according to McKinsey.
Identify Ways to Reduce Emissions
Once you understand your carbon footprint — whether that’s a baseline overview or details on different emissions scopes — you can identify ways to reduce emissions. It might help to start with low-hanging fruit for easy wins that build momentum.
For example, many businesses are now trying to figure out the right hybrid work balance. Maybe you want to do a three-day/two-day split but aren’t sure which direction to go. Perhaps after calculating emissions from employee commutes, you’ll decide to go with three days per week of working from home and two days in the office, which would reduce emissions more than doing three days in the office.
More comprehensive emissions reduction plans may require expert input. Perhaps you can work with an energy consultant to identify ways to upgrade your HVAC equipment or increase your renewable energy generation capabilities.
As you make these changes, you can recalculate your carbon footprint. That way, you can clearly see how your environmental sustainability actions make a clear impact. You can even incorporate these findings into areas like marketing.
Letting customers know about your corporate sustainability plans can encourage them to stick with you over competitors. Globally, 60% of consumers cite sustainability as an important purchasing factor, finds a study by Simon-Kucher & Partners.
Use Carbon Offsets to Account for Remaining Emissions
As you go through your sources of carbon emissions and find areas you can reasonably eliminate, you might run into some roadblocks.
For example, you might not be in a position to cut out all business travel or product shipping. In some cases, you might be able to minimize emissions from these activities, like shipping products via vehicles that use renewable energy. Even flying direct instead of taking connecting flights can help.
Still, you might not be able to get all the way down to zero emissions on your own. If you want to account for your remaining emissions, you could purchase carbon offsets.
What are carbon offsets? Essentially, they’re credits that put money toward sustainability projects to ultimately reduce emissions. Building out wind farms via carbon offset funds, for example, can reduce emissions that would otherwise be generated by fossil fuels.
One way to think about carbon offsets is by comparing them to calories.
If you want to achieve a net-zero balance between calories consumed and calories burned, you might focus on reducing your caloric intake — similar to managing the emissions you generate. But maybe you’re having trouble reducing your calories enough to be in balance, so you add exercise to negate some calories — similar to buying carbon offsets.
Start Improving Your Corporate Sustainability
Focusing on these areas can help your business develop an environmental sustainability strategy that’s attainable and impactful.
As you start to understand your carbon footprint and reduce emissions, you can also tie these actions into broader corporate sustainability goals, like making a more positive societal impact in the communities you operate.
Instead of flying employees out to a remote location for an annual corporate retreat, for example, you could reduce emissions and engage stakeholders by holding local community cleanup events.
To get started on improving your sustainability, use our simple calculator to determine your carbon footprint. Want to dive deeper? Schedule a consultation to explore custom sustainability solutions for your business.
Brought to you by terrapass.com
