There’s a lot of talk about carbon and ecological footprints, but what are they and how do you start?

Basically a footprint assessment aims to calculate an organisation’s (or in some cases a product’s) direct and indirect use of natural capital assets (i.e. inputs provided by nature) and/or its contribution to one or more forms of pollution. A carbon footprint concentrates on measuring the emission of man made greenhouse gases (including carbon dioxide, methane and a number of others as defined by the GHG Protocol – a global measurement standard developed as part of the World Resources Institute and World Business Council for Sustainable Development and aligned with the measurement objectives of the Kyoto Protocol).

For many services based organisations it is relatively simple to calculate direct emissions based on use on use of fuel (e.g. by fleet vehicles or building generators). These are called “Scope 1” emissions under the Protocol. For industrial firms, consumption or creation of the full range of GHGs needs to be considered.

Scope 2 emissions are associated with purchased electricity, heat or steam. These are generated by a third party organisation and it’s necessary to understand how they have been produced (black coal, brown coal, oil, gas, wind, hydro) and in what proportion to in turn decide upon an appropriate coefficient to apply to consumption units such as kWh and in turn determine the associated emissions. Fortunately, many state governments have taken the guess work out of this process and publish official coefficients.

Finally, Scope 3 emissions deal with emissions arising because of the organisation’s activities that are not within the organisation’s control. This is where it gets a bit complicated because  at its logical extent it involves understanding the emissions associated with every step of your organisation’s upstream supply chain right back to the extraction of the raw materials and all intermediate processing steps. And not just main suppliers, but everything from office supplies and computers to your use of taxis and flights.

If you’re considering the footprint of a product, you also need to follow the supply chain downstream and look at the emissions associated with all life cycle stages including shipping and distribution (including packaging), lifetime use of the product and end of life disposal.

The bad news is that fully determining Scope 3 emissions and undertaking a full product life cycle assessment can be extremely challenging. In some cases the science and standards are still developing around measuring the impact of different activities. The process also involves the cooperation and effort of numerous organisations who must all be consistently applying a common measurement framework.
Moving beyond GHG emissions and looking at the organisation’s broader impact on the planet’s limited natural capital resources is even harder. Here the Global Reporting Initiative’s measurement standards for ecological footprint reporting are a good place to start.

However, armed with this information an organisation can start to understand how they can reduce their footprint and what changes and innovations will generate the best bang for buck environmentally. They can use their measurement data to benchmark against peer organisations, track their progress towards footprint reduction, and communicate their success to current and potential customers. As awareness of environmental issues grows, more customers and regulators will be demanding comprehensive footprint data.
Talk to Adaptive Capability today for help with starting to measure your footprint or to understand best practice measurement standards.

David.McEwen@AdaptCap.com

We’re starting to see examples of how climate change is impacting our economies, with super storms like Hurricane Sandy disrupting millions of people and causing tens of billions of dollars worth of damage. That’s just the beginning, with water and food shortages, public health and coastal inundation risks set to cause widespread disruption, rising prices and more in the coming decades.

Even now there’s another threat emerging to business as usual, with a global divestment movement urging investors to get their money out of banks and stocks that finance or contribute to fossil fuel emissions.

Enlightened consumers are becoming more discerning in their purchasing, preferring products and services with lower environmental footprints and becoming less susceptible to “greenwash” marketing. Regulation is likely to play catchup over the next 10 years, putting the financial viability of certain industries at risk or outright shutting

Foresighted organisations are thinking hard about the prospects for their products and services, markets, geographies and industries. In some cases they’re realising that business as usual isn’t a medium to long term option and are starting to reinvent their business models to find opportunity in a climate changing and environmentally challenged world.

And it’s not just energy companies. Take coral coast tourism. Australia’s Great Barrier Reef generates over $5 billion per annum in tourism revenues. But the reef is being hit hard by the interrelated quadruple whammy of agricultural runoff creating nutrient rich waters that are attracting destructive pests such as the crown of thorns starfish; rising water temperatures and increased acidification due to increased concentrations of greenhouse gases threatening coral bleaching and loss of biodiversity; increasingly intense storms damaging the reef and coastlines; and, ironically, government endorsed pollution risks in the form of dredging sediments and increased bulk shipping as coal terminals are expanded along the coast. Indeed, UNESCO recently reviewed the status of the World Heritage listed area and criticised Australia’s stewardship of the reef.

Any owner of tourism infrastructure assets along the coral coast should be extremely nervous about the value of their investments. Operators may be able to take advantage of “last glimpse” tourism before the reef is degraded to the point that it ceases to be a viable attraction. Exposed organisations should be starting to plan for the reinvention of their business models.

Talk to Adaptive Capability today about safeguarding your business’ future.

David.McEwen@AdaptCap.com