Interested in hearing about upcoming webinars? Subscribe below.
By many accounts, 2023 is expected to be a transformative year in the evolution of climate-related disclosure and mitigation requirements in the United States. In this webinar, we cut through the jargon to provide clarity about what climate-related requirements may be coming for US companies by unpacking the two proposed federal rules that are currently pending and one EU regulation that affects some US companies.
Sustainability reporting serves as a valuable tool to achieve corporate commitments and better manage climate-related business risks. This white paper walks you through what’s typically included and what should be considered.
Hello, and welcome to the recap of our recent Q&A. I’m Nicole Sullivan, Director of Climate Services at CarbonBetter. During this Q&A session, we addressed several practical aspects related to initiating and developing sustainability strategies for businesses. The session was designed to clarify and provide insights into diverse topics such as integrating sustainability into operations, performing carbon accounting and reporting, setting sustainability goals, and navigating the world of carbon credits. The answers provided were based on practical experience and designed to help businesses comprehend and manage the challenges that come with implementing sustainability initiatives. Below is the full replay with chapters marking the start of each question.
Hi y’all, and welcome to today’s session.
This one’s a little different for us
if you’ve tuned into any of our other webinars.
So today we have an Ask Us Anything.
We actually have been taking questions
for the last few weeks,
so we’ve got a lot of questions already identified
that I’ll be answering today.
But I would like to point you to the question’s feature.
So you can ask questions throughout the session.
I will do my best to answer them as we go,
or at the end,
depending on the nature of the question
and what topic it relates to.
So just to start a quick introduction, I’m Nicole Sullivan.
I’m the Director of climate services for CarbonBetter.
So at CarbonBetter, we help folks with every step
of their sustainability journey from quantifying
and disclosing their environmental impacts
through storytelling and sustainability reporting,
all the way to developing sustainability
and decarbonization strategies,
and ultimately reducing emissions
through direct decarbonization as well as participation
in the voluntary carbon market.
I’m an environmental engineer by trade,
and I’ve been in the consulting space for a long while,
so I feel equipped to answer a lot of your hard questions.
But if there’s anything that comes up
that I need to dig into later and get back to you, I will.
All right so to start,
we had a few different questions come in
about sustainability strategy.
So the first one we had is as a small business
just beginning our sustainability journey,
which cost effective strategies should we consider
for integrating sustainability into our operations
to make an immediate positive impact?
So my answer is gonna be kind of an,
it depends situation, but I think for starters,
it’s awesome that you’re wanting to get started
and you’re wanting to take action.
One of the first things you can do
is really identify the resources you have on your team
that know about sustainability
or that are passionate about it.
Who are your stakeholders within your business
that care about driving initiatives forward?
And then, while I know we have this like you know,
burning desire to just like take action
and throw money at solutions, it can be really important
to actually set a strategy and have a plan.
So in this space, there’s this concept
of what gets measured gets managed.
And so it’s really important to really first take a look at
where you’re at today, to see what actions to prioritize.
So if you haven’t done so already,
you can quantify your carbon footprint,
look at your water impacts and waste impacts,
and figure out where in your business
you could drive the most change.
And it’s gonna look a little different
depending on the nature of your operation.
So low hanging fruit actions,
if you are like a manufacturer of a product,
are going to look a lot different than you know,
the low hanging fruit you might incur
if you are an office building.
So I’m gonna use the office example whereby you know,
you have office space that you maybe lease out
and so you quantify your carbon impacts
and you realize that electricity consumption is really,
is really the biggest source of your emission.
So if you’re leasing the space,
maybe you don’t have the option for onsite solar
or that’s out of your budget,
but there’s opportunities to look into, you know,
do you have access to potentially procuring
a green energy plan,
or can you purchase renewable energy certificates
or knowing what your carbon footprint is,
can you purchase carbon offsets to start taking action
while you plan for projects that might be bigger
or longer term, or require more investment,
like, you know, investing in energy efficiency projects
or lighting projects.
One thing I forgot to,
I guess call to your attention in kicking this off,
some of the slides today have QR codes
with the option to dig deeper.
So we’ve tried to really link up relevant content
that we have for specific questions
in case you want to dig further on a given topic.
So I just wanted to call that to your attention as well.
The next question we have is how can we use the results
of a materiality assessment
to inform our sustainability strategy
and drive meaningful change within our organization?
And I’m actually gonna take a step back on this one
and really talk about,
well what is a materiality assessment?
And this is something that we see is you know,
it’s a tool used very commonly in the ESG space
or the environmental social and governance space.
I’m gonna really look at it in the lens
of just the E or the environmental portion.
And before you even do an, a materiality assessment,
you should really look at how your business interacts
with the environment,
which is the concept of your environmental aspects.
And at each place that your business
interacts with the environment,
there’s the potential for environmental impacts.
So let’s look for example,
if you are in the agricultural space and you are using water
to water your plants, that water withdrawal
is an environmental aspect.
And potential impacts could be depletion of water supply
as well as degradation of water quality.
So once you’ve gone through your business holistically
and you’ve looked at your environmental aspects,
so those points where you’re interacting
with the environment
as well as those potential environmental impacts
to dig into materiality,
you’re going to look at how important
are each of those topics to your stakeholders.
And stakeholders can mean any number of things
depending on your business.
Your stakeholders might be,
they might be your investors, they might be your customers,
they might be your employees.
So you’ve gotta look at who this stakeholder ecosystem is
that matters to you
in the case of this materiality assessment.
And then look at which of these topics
are most important to them.
You’re also going to look at which of these topics pose
like a risk to the success of your business.
So while materialities assessments
can be somewhat subjective,
you’re going to basically define a scoring system
and really figure out which of these environmental impacts
topics are most important to your stakeholders
or are most threatening to the success of your business.
And then from there, once you’ve done that assessment,
you can actually drill in
and really focus on mitigating those risks.
So, you know, if water say is of high importance,
maybe you’re in the alcoholic beverage space,
which you know, alcoholic beverages consume a lot of water
in the production.
And so maybe water consumption
is a really highly material topic.
You can really start to,
if you haven’t done anything today,
you might wanna do a water footprint
and then you might wanna set goals
around reducing your water consumption
and really taking action there.
So materiality assessments are really a lever
that can help you, help you know where to focus your efforts
as well as focus your resources, right?
Because quantifying your impacts
and taking action on your impacts
and setting goals and, you know,
implementing projects, all of that takes time and resources.
So you wanna focus,
focus your resources in a way that best protects
the environment while also best protecting your business,
both from a reputational and a success perspective.
And then also that you know,
that benefits your stakeholders.
So the next question,
and I was actually really excited that we got this one
because this is a topic that I’m really passionate about,
is how can we develop a holistic sustainability strategy
that not only focuses on decarbonization,
but also addresses other critical aspects like water
and waste management.
And right now we see, we see a lot of companies
and brands setting net zero targets
and really focusing energy on decarbonization,
which is super important.
I am a huge advocate for that.
But when we look at net zero,
we’re really looking at carbon kind of in a vacuum, right?
So the net zero equation looks at your carbon emissions
and your efforts to reduce those emissions
and offset those emissions with the goal of netting out
But it leaves out a bunch of things.
So other air pollutants besides greenhouse gases
and carbon are excluded from net zero.
So things like hazardous air pollutants
or criteria air pollutants,
those are excluded from a net zero approach.
You’re also not looking at water and when we look at water,
we’re looking at both quantity and quality, right?
So we should be considering our water withdrawals
and our discharges and our consumption
as well as any degradation.
So our, is our business having a negative impact
on water quality?
And then from a waste perspective,
there’s a lot of considerations.
You wanna look at your waste footprint
in terms of solid waste streams, hazardous waste streams,
potentially electronic waste streams.
And waste has a lot of considerations in terms of,
you know, where is your waste going?
So this poses a lot of complexities
if you’re in the consumer packaged good space
and you’re selecting packaging you know,
we’re seeing like compostable packaging for example,
trending and you know,
most individuals don’t have access
to industrial grade composting facilities, such that like,
is your compostable packaging actually ultimately
even being composted?
So I think in terms of setting a holistic strategy,
it is really important to not look at carbon in a vacuum,
but how you look at the different components
of environmental impacts you know,
will somewhat depend on the nature of your operations,
the nature of your waste streams.
You know whether water is a really heavy hitter for you.
And I think something that is really important
to keep in mind too is that water and climate
are so closely interrelated, right?
So access to water, water scarcity challenges you know,
they really go hand in hand.
So it’s important to consider them,
and you can even consider them
in your decarbonization strategies.
So we’ll touch more on the voluntary carbon market leader
in the session,
but you can actually look for carbon projects
when offsetting your carbon emissions
that also have co-benefits with specific focus areas.
So if water is a big concern for your business
or a high impact area,
you might look for carbon credits
that have water co-benefits associated with them as well.
So the next, the next one I’m gonna cover is
how can we build a more sustainable supply chain
by identifying, collaborating with
and ensuring our suppliers and partners are aware of
and share our commitment to sustainability.
In this one, we actually,
I’ll talk about Scope three emissions some later as well
because we see this as a challenge area for folks.
We had multiple questions as it relates
to supplier engagement as well as quantifying the impacts
from suppliers and in terms of you know,
building a more sustainable supply chain
and collaborating with suppliers.
You know, one of the first things is
if you as a business have developed
your own environmental policy
and you’re you know, company-wide
working towards certain goals,
part of ensuring your suppliers can help you meet those
is communicating those goals and those policies out
with your suppliers.
So that can take a number of forms, whether it’s you know,
via just calls or during the contracting process
or putting out informative collateral.
You could even do webinars with your suppliers
as well as if you are,
if you’re quantifying your impacts
and disclosing those through sustainability reporting,
ensuring that all of your suppliers have a copy
of that report in terms of you know,
collaborating with them.
If you’re quantifying Scope three emissions, which you know,
are basically everything besides your direct emissions
from energy consumption as well as your,
like emissions from consuming electricity.
So supply chain falls under Scope three.
If you’re quantifying those emissions,
you’re likely relying on your suppliers for data.
And some of those data points can come through you know,
your accounting department and procurement
where you’re looking at, well,
how much of this thing are we purchasing from our suppliers?
But your suppliers might be taking action
or have done the math associated with their products
or the things you’re procuring already.
So having that open dialogue with your suppliers
can not just make them aware of what you are doing,
but also allow you to be more aware of the efforts
that they’re taking as well as to then explore any synergies
or any overlap, right?
You might find that you have goals in common
that you can work towards.
And we’ve even seen brands work with their suppliers
to implement projects.
So if you’re working with a supplier
that maybe has you know
is one of your heaviest emitting sources
because you’re using them as like a co-manufacturer,
there might be opportunities where you could help them
to implement projects or reduction strategies.
And then the last thing I wanna maybe call out here is that,
you know, you’re quantifying the impacts of your suppliers
if you’re doing your Scope three emissions
and you’re, if you’re doing a robust sustainability report,
you might also be talking about the stories
and the trade offs of why you chose certain suppliers.
So you know, if you’re open to making your suppliers,
you know, identifying them publicly,
which you might not be due to, you know,
the complexity of your supply chain
or you know, privacy concerns, but it you know,
if you’re open to those relationships being public,
there might be opportunity to highlight some of the wins
that you’ve had with your suppliers
in your sustainability reporting,
which can then motivate your other suppliers to do more
and to do better.
Right, so the next kind of bucket of questions
that we got in are surrounding carbon accounting
So the first one we’re gonna tackle is
our business is growing rapidly,
how can we measure progress towards improving our impacts
when our overall footprint is expanding
as our business grows?
So this is one that like,
is always really interesting to me, right?
People come to us, they do their carbon,
we do their carbon accounting and you know,
they have their footprint,
but they’re also scaling up operations, right?
Maybe they are expanding their distribution footprint
or they are adding new suppliers,
or they went from operating five days a week to 24/7
because, you know, growth has been super rapid,
which is awesome, right?
If you’re building a business that is your goal,
to scale that business and to grow
and generate more revenue.
But sometimes in tandem with that
comes an increased carbon footprint, right?
Because as you add more suppliers,
as you start operating 24/7,
all of a sudden your emissions profile is actually going up
because you’re consuming more energy
or you are distributing globally versus when you started,
you were only distributing in the United States.
And with that, sorry,
I’m seeing a question come through in the chat,
I got distracted, apologies.
So as your business scales, as your footprint scales,
what can you do about it, right?
You’ve set targets
where you’re supposed to be decreasing your emissions
and yet you’re watching your emissions go up.
And there’s a really important concept
that I wanna touch on, and that’s emissions intensity.
So as you scale up,
even with an increasing emission footprint,
it’s really important to work towards
decreasing your emissions intensity.
So if you’re manufacturing a product
that emissions intensity often looks like your emissions
per unit of product, typically either in grams
or kilograms of carbon dioxide equivalent.
So it’s really important to know your overall you know,
company-wide carbon footprint,
but normalizing that carbon footprint
into per product terms.
Or if you are, if you are maybe like an office,
an office only business,
your emissions intensity might be normalized to terms of,
you know, emissions per square foot or emissions per,
you know, full-time, full-time employee equivalent.
But basically relating those emissions
into a given unit allows you to track
if you’re becoming more operationally efficient
and carbon efficient as you grow.
So I have a case study here,
which this is Beatbox beverages.
So as you see, they actually have zero Scope one emissions,
a really small scope to a foot,
scope to emissions footprint,
and then the bulk of their emissions come from Scope three
because they use a co-packer to manufacture their product.
And as you can see,
they consider a number of emission sources
in their overall carbon footprint,
which totaled out to 6,806 metric tons of carbon dioxide.
They then were able to relate that back
with a greenhouse gas intensity of 445 grams
of carbon dioxide per carton of party punch.
An additional reason to normalize your emissions
into an emissions intensity value
is it’s obviously to be able to track progress
and to really see if you’re becoming more efficient,
but it’s also a really helpful metric
for your end consumers or your end users
or even your employees to be able to think about things
in terms that make more sense, right?
Like, you know, I’ve been in this space for a long time
and a metric ton still sometimes feels like a nebulous unit
of measure, right?
It’s a metric ton of carbon dioxide,
which you can’t see.
But when you think about it in relation to this thing
that you’re able to hold in your hand,
it makes it more tangible for your consumers.
So it’s important to consider your growth plans
when you’re setting your carbon or decarbonization goals,
You’ve got a factor in the fact
that you have this plan to grow,
you have this plan to expand your operations.
So how do you work decarbonization into that growth
so that you are, you know,
perhaps you’re procuring more energy efficient equipment
or doing fuel switching or, you know,
implementing renewables projects.
There’s any number of ways to start working decarbonization
into your growth plan.
And you also might factor that into your you know,
carbon offsetting budget.
But emissions intensity is a really important metric
to be tracking because even as your footprint grows,
the goal should for sure be
that your emissions intensity strengths
and your overall emissions per unit of product
or emissions per square foot
or whatever that normalizing factor is
that that would decrease over time
as you try to make progress to your goals.
The next one I have is how can we report in a way
that’s transparent and positive while avoiding greenwashing?
Our leadership team is worried about disclosing impacts.
So this is something that’s actually been a hot topic
in our Slack channel lately,
because I obviously, greenwashing is a term
that’s been around for a while,
but there’s some emerging buzzwords in the space
such as green hushing, where you’re taking action,
but you’re not talking about it
because you wanna avoid scrutiny.
There’s green rinsing, there’s green lighting,
there’s really, there’s a number of new greenwashing
related buzzwords that, you know,
people are also now worried about avoiding
and wanna make sure they’re not misstepping.
And so in terms of how to report in a way
that’s transparent, you know,
I think something that’s paramount is really telling people
what you did and also how you did it, right?
So we are seeing a lot of brands disclose
their carbon footprint and that is great,
but there are a lot of ways to calculate a carbon footprint
and there’s a lot of different boundaries you can set
when carbon footprinting.
So for example if someone puts out a number
that’s say a 1000 metric tons carbon dioxide equivalent
is, you know, that’s their carbon footprint,
is that their Scope one carbon footprint?
Is it Scope one, two, and three emissions?
You know, what emission sources are represented in that?
And then there’s also the question
of how did they get the number?
So something that I am really a firm believer in
and something that we do in our sustainability reporting
efforts on behalf of clients is we actually, you know,
we disclose the assumptions that were made in the math,
we disclose the methodology that was used.
There’s a whole lot of standards and protocols out there
and different emission factors
and different ways to quantify emissions.
And with that you know,
there’s a lot of right ways to do things.
There’s some wrong ways to obviously,
but it’s really important to tell people what you did
and how you did it.
We’re seeing there, you know,
there’s data out there that many consumers
don’t trust brand sustainability claims
or don’t feel they have enough information
to verify those claims.
So if you’re gonna put data out there, do so,
you know, don’t make vague claims
like there’s a lot of you know, buzzwords you can use
that don’t mean a whole lot.
So if you’re gonna tell your story and tell your impacts,
do so in a way that really is trustworthy and transparent,
that highlights the what you did and the why you did it.
And if you do so in that way, it makes it a lot easier
for all of your stakeholders across the board,
whether that’s investors or employees or customers
to trust that data because you’re giving it to them,
you’re showing them how the sausage is made
and ultimately that really resonates with folks
and it lowers the risk of any accusation
because you’re doing things in a way that shows people
that like you stand by what you did
and you’re willing to open the door into how you did it.
And I just actually wanna touch on this slide really quickly
So I mentioned there’s a number of standards
and protocols out there,
and that can feel overwhelming in itself to navigate.
So you know, there’s the greenhouse gas protocol,
which can guide you
on how to quantify your carbon footprint.
You know, we’re seeing more and more businesses
submit reports through you know,
like frameworks and standards such as CDP,
which was formerly the Carbon Disclosure Project.
And it you know, following a protocol or a standard
such as the, you know,
sustainable accounting standards boards or SASB,
following these protocols or using them as guidance,
it’s another way, you know, that can help, help, you know,
give trust signals because you’ve shown your methodology,
you’ve disclosed that you’re reporting in accordance
with a given standards,
you might disclose actually to that body
and then be compared to other companies
in your same industry or across industries.
So I do know that it can be scary to take that first step
and make your impacts public, but it also,
if you’re in a space where few of your competitors
are doing so,
it creates the opportunity for you to be a front runner
and be a leader in the space and actually drive change
and motivate your competitors to do better as well.
And then something that’s also a consideration
is your customers want to see your impacts, right?
Like we’re seeing a lot of data that, you know,
customers even will choose what they buy
based on the environmental impacts of a given product.
So putting that out there can really be beneficial
for your brand as well as have a return on investment.
All right, the next one, which I kind of teed up earlier is,
how do we account for Scope three emissions
in our carbon footprint calculations
and what actions can we take to reduce them?
So Scope three is going to look very different
depending on the nature of your business.
Say you’re a consulting firm and you have, you know,
an office space, but you know,
you’re not really procuring much,
but maybe you do a lot of corporate travel.
Those corporate travel emissions
would fall under your Scope three.
If you are in say like the food and beverage space
and you’re sourcing ingredients
and or you’re making a product
and you’re distributing that product you know,
packaging falls under Scope three there you know,
Scope three is like this nebulous catch-all
for a lot of people and it can feel really overwhelming
because, you know, you might feel like, oh, okay,
well I am, you know I procure one bottle of this thing
Do I need to chase down those molecules
of carbon dioxide equivalent?
And, you know, I think in terms of getting started
with Scope three, it can be really important
to just sit down and look at
what are all the potential sources
that would fall under Scope three,
and then what are your resources?
Like, are you doing this in-house?
Are you using a third party?
You know, what are your relationships
with your suppliers like?
Have you done any supplier questionnaires
where you already have some data
and insight on a given supplier?
But in the case of you know,
getting started for Scope three, you know,
an important way to kind of help get started
could be just to first look at
what are the biggest sources of those emissions?
Say you’re making a product
and one input makes up 90% of your procurement,
focusing on that thing first can be kind of
the lowest hanging fruit of getting started.
The data gathering can be trickier for Scope three,
right, because you’re not just relying on data
that you already own yourself.
You likely have to engage with your suppliers
or start doing some you know, research.
If we’re talking about like agricultural inputs,
you might be looking for lifecycle assessment factors
for a given ingredient.
So Scope three can be intensive,
and so it’s one of those things
like you kind of just have to get started
and you have to do it.
Well, I guess technically you don’t have to, let me,
let me backtrack you, you know,
there are some emerging regulations
that might require you to do so.
In the voluntary space there’s no technical like obligation,
but at the same time depending on your operations,
Scope three really could be the biggest source of emissions
in your overall carbon footprint.
So I do feel it’s really important for brands to step up
and start calculating their Scope three emissions.
And it’s something that you can build on over time.
You don’t have to go from zero to a 1000
and catch every single source,
but maybe the first pass you get as many as you can
and then you’re like, okay
this one Scope three emission source is really tricky
and I’m gonna have to like figure out the data for it
or talk to this person and maybe you know,
that one takes a little longer.
I think, you know, in this race to get things done,
we, you’ve still gotta be pragmatic and you know,
a lot of times if you’re a smaller business,
sustainability might be a hat that you wear on top of,
you know, your everyday role.
And so it can, you know, Scope three can feel overwhelming,
but at the same time,
if you really take a step back and just break it down
in terms of what are the sources you know,
which sources are most you know, most heavily like,
impactful to your business and really start there
and approach it pragmatically you know,
I think it’s very much, it’s manageable.
In terms of actions to reduce them,
you know, this is another place
where you might have influence but you have less control.
So you can look at you know,
if you know maybe a supplier that has you know,
really high emissions and that you know,
maybe you have to work with them because of X, Y, Z reasons.
Like, is there the opportunity to work
in decarbonization goals to your contract or, you know,
work contractually obligate them to provide data.
And again that can take time to set up
depending on your contracting cycle.
So the strategy really does look different
depending on the nature of your Scope three emissions.
But I think, you know,
the fact that we’re seeing these questions
people are interested in tackling it
and rising to the challenge,
which is encouraging to see.
The last kind of bucket of questions that we got in advance
of the session were around goal setting.
And the first one is how do we set realistic
and impactful sustainability goals for our organization?
And with this one, I cannot you know,
stress enough the importance of knowing where you’re at
before you set goals.
You know, goal setting is super important to making progress
and decarbonizing or reducing your water impacts
or waste impacts.
But you know we’re seeing people race
to set net zero targets or carbon reduction targets
before they actually know what their carbon footprint is.
And knowing where you’re at today will help enable you
to set goals that are achievable and things you can work for
as well as to start planning
for how you’re going to achieve them.
So once you have a baseline, you can set goals
and start measuring progress towards those goals.
And it’s important even in this space
where we’re seeing people set goals you know,
for 2030 or 2040 and even beyond into 2050 you know,
those targets are great,
but what are those milestones you’re working towards
in between, right?
Like if you’re gonna go from you know,
X carbon footprint today to, you know, net zero in 2040,
what’s your pathway to get there?
Because ultimately, you know, carbon credits are a tool
and they’re a really important lever
for offsetting emissions.
But you know, direct decarbonization is important
and it takes time and money and planning.
So if you’ve set a 2040 target,
you can’t wait till 2039 to start working towards that.
So really it’s about being pragmatic,
knowing where you’re at today,
and then setting interim milestones
that you can work towards as well as continually tracking
your progress and looking back at, you know,
where are we at today in comparison to last year
and five years, five years ago.
And also something to consider
is that your goals may adjust, right?
Technology is changing so you know,
there, a technology might emerge
to help you reach your goals
that you hadn’t even accounted for when you set those goals.
So I will say that sustainability is a really agile space
in that, you know, you do have to adapt and adjust,
but you don’t wanna set goals and make them public
and then backtrack on them.
And I hate to call out Crocs
because like I actually love their footwear
and wear them pretty regularly,
but they set a 2030 net zero target
and then just recently pushed that back to 2040
once they realized, you know,
the work and what it would take and you know,
good on them for owning it and putting it out there
and like you know, stating it.
But at the same time, like if you’re gonna go about this,
you know, do so pragmatically in a way
that you can avoid that misstep, right?
You wanna deliver on your goals both for the planet
as well as for your stakeholders.
The next one is, our company has achieved carbon neutrality.
What are the next steps to strive for like,
for example, carbon negativity.
So I think the first thing to consider is
what are you carbon neutral for?
Are you carbon neutral for Scope one, two, and three
or are you just carbon neutral for Scope one and two?
And if it’s the latter, I would encourage you to you know,
first expand going carbon neutral for Scope three
before considering going beyond carbon neutral.
The next thing to consider is how did you go
about carbon neutrality?
Were you able to directly decarbonize
or did you rely exclusively on carbon credits
or some combination.
And then you know, really look at you know,
what were they high quality carbon credits,
are there opportunities to do more direct decarbonization?
And then once you’ve really optimized and like you’re doing,
you know, doing carbon neutral in the best way that you can,
carbon negativity or sometimes also referred to
as climate positive is absolutely a great goal.
And basically it means that you’re offsetting emissions,
you know, you’re offsetting beyond zero, right?
So your offsets are greater than your emissions.
And it’s something you know,
you, by investing in carbon credits to offset your emissions
you’re investing in decarbonization activities globally.
So definitely a great goal to strive for.
And then also you know, again,
I’m gonna go back to something I talked about earlier,
is not to look at carbon in a vacuum, right?
You know, are there opportunities to set or work
towards water goals and waste goals?
There’s a lot of ways you can positively
impact the environment beyond reaching carbon neutral
or even carbon negative.
And then I, we’ve actually got one more bucket here,
I think I said the last one was the last one.
So carbon credits.
When choosing carbon credits to offset our emissions,
how can we choose high quality carbon credits?
So this is something that’s,
it’s really important to me is that while a carbon credit
represents one metric ton of carbon dioxide equivalent,
not all carbon credits are created equal.
And if you are going to be using you know,
carbon credits to offset your emissions,
if you’re using that lever as a tool to reach your goals,
it’s really important to invest
in high quality carbon credits.
And that can look like a bunch of different things.
There are some emerging, you know,
ratings bodies out there and people, you know,
protocols around quality credits.
But I’m gonna really dig into the core ones that are,
you know, important to us.
So is the project additional?
And that’s something that means like,
would the project have happened otherwise in the absence
of this carbon credit or you know, in business as usual
and if it would’ve happened business as usual,
that project is not additional
and not something you should invest in.
You also want projects that are you know,
real and credible and have been compared
to a credible baseline.
So to ensure that that project is taking real action,
you first have to look at what was the baseline state
before implementing the project.
And then you’ve also gotta look at measurement
How was that carbon reduction
or carbon sequestration measured?
Was it done so accurately?
And then something that is really paramount to me is,
was it third party verified?
Third party verification and credits from, you know,
high quality registries or trustworthy registries
that require third party verification
is a really important consideration.
You know, that verification ensures
that the math associated with issuing that credit
was accurate, that boots on the ground
that that project exists.
And you know, in the case of say
like a reforestation project that those trees were planted
in the ground and they are growing
and they are sequestering that carbon.
You also want to avoid double counting.
So in the case of reputable registries,
when you retire a carbon credit,
that credit is taken out of circulation so that you know,
at that retirement point you have officially offset
your emissions with that credit
and that credit can no longer be applied
to anyone else’s emissions profile.
It can no longer be used again in a you know,
you don’t want to buy a carbon credit that’s double counting
in emissions reductions
or is part of multiple carbon credit programs.
So it can feel really complex to navigate,
but it’s definitely, you wanna ensure that you know,
with your budget that you’re spending on carbon credits,
you’re investing in high quality projects.
And then something that we also really like to look at
are our co-benefits of a carbon project.
So obviously you wanna ensure that there’s you know,
accuracy and verification and confidence
in that carbon credit representing one metric ton
of carbon dioxide.
But also is that project doing anything else beneficial
for the environment?
Is it increasing or protecting biodiversity?
Is it, is there an aquifer restoration component?
Has it created jobs or health benefits in the community
in which it was implemented?
Co-benefits can be you know, a great value add
when you’re, you know, procuring carbon credits.
And then the last one I think that we have
before I go over to audience questions is,
we’ve done the math for our Scope one
and two carbon footprint and we wanna offset that
to achieve carbon neutral.
Where and how do we buy carbon offsets?
And for anyone in the audience that has you know,
ever tried to procure carbon either for yourself
as an individual or on behalf of your business,
it can often feel harder to do
than it seems like it should be, right?
It’s not like online shopping for shoes
where you have kind of limitless options.
If you’re going, if you’re looking to procure carbon credits
and say you have, you know,
a few 100 metric tons of carbon dioxide emissions
that you’re offsetting, which is a pretty low footprint
and something that you know, you wanna offset,
but your options look a little different.
So you might go online to marketplaces
to procure that carbon,
such as like the gold standard registry,
which is one of the more reputable registries out there.
They have a marketplace where you can buy carbon credits
directly from projects issued by the registry.
There’s also some marketplaces like cool effect,
which have, you know, projects you can procure.
Something you’ll find though,
when you’re buying carbon in this way,
you’re really limited in terms of the types of projects
you can gain access to as well as, you know,
pricing can be a little higher on a per ton basis,
but say you’re getting into that, you know,
05,000 to 10,000 metric tons of carbon dioxide, it, you know,
you might at that point go through brokers
or you know, do an RFP and send it out
to several different brokers or developers
and try to source carbon in that way.
And you might find that that’s still, you know,
you’re still getting a limited,
a limited variety of projects perhaps
because you know, to some parties in the space
that might seem like still like a relatively small volume
So something that’s really important is you know,
if you’re working to procure carbon you know,
identifying your goals beyond offsetting the emissions,
are there specific geographies you’re looking for
where you want a project that’s close to home
or you’re looking for specific co-benefits
or maybe you’re looking for nature-based solutions.
So we really like at CarbonBetter,
we do bespoke carbon sourcing on behalf of our clients
where we really tailor our project offerings
to what they’re looking for.
And then we also have a carbon credit portfolio
that we can transact on regardless of your volume of carbon.
So even if you only have a 100, you know,
a 100 metric tons that you need to offset,
we can do that in a way that gives you access
to multiple projects.
But it’s one of those things,
I think working with a party that you trust to do
due diligence and verify that projects are high quality
and then really considering the criteria
that’s most meaningful to you in sourcing carbon.
But a lot of how you go about buying it
or sourcing it depends on the volume of carbon
that you’re shopping for as well as your budget, right?
You might have you know, goals of like purchasing,
you know, carbon credits from a blue carbon project
because you’re really passionate about mangroves,
but your budget might not indicate
being able to completely offset all of your emissions
with that, but you might be able
to take a portfolio approach
and blend some of those mangrove projects in.
And then one thing too that I just wanna touch on,
and I maybe should have done this at the beginning,
but I’ve, you know,
I’ve talked a lot about Scope three emissions so far today
and we’ve also talked a good bit about offsets,
but I just wanted to really kind of show
the net zero equation here,
the carbon equation where we’ve got you know,
our emissions of Scope one,
which is our direct emissions from operations Scope two,
which would be indirect emissions from purchase energy
such as electricity.
And then Scope three,
which is really all other emission sources from you know,
supply chain as well as corporate travel.
And then there’s multiple ways to reduce emissions.
So we’ve touched on carbon credits a lot,
which equal, you know one metric ton of carbon dioxide
reduced or sequestered,
but I really can’t stress enough the importance
of direct reductions through, you know, operational changes.
You know, taking direct action
while also using carbon credits in tandem as a tool
is a really important part
of having a holistic decarbonization strategy.
And then something we didn’t really touch on today,
but I just did wanna call out as another kind of you know,
tool is renewable energy certificates,
which are really a lever for your Scope two emissions.
All right, and so with that
I have seen some questions flow in,
so I’m gonna jump over to those.
Let’s see, sorry, give me a moment, bear with me.
The first question I’ve got here is for small
and medium sized businesses.
What are the best reporting systems to get started with?
And I’m gonna take this answer a couple different directions
’cause I am not a 100% sure what was meant
by reporting systems in this case,
but I’m gonna start
with the quantification perspective first.
So your carbon accounting or your environmental impacts
accounting and you know,
I think there’s a lot of shiny softwares out there right now
marketing themselves as an easy button
for quantifying your impacts.
But in terms of quantifying your emissions footprint
as you get started, there’s a lot of data to gather,
there’s a lot of business processes
you might have to implement.
So, you know, starting with a spreadsheet can be,
you know, a really, like a really low lift way to start
and you know, quantify from there.
And then in terms of actually disclosing your emissions,
you know, there’s a lot of ways to go about it
and if you’re looking to disclose them
via one of the standards like CDP or SASB,
you’re probably gonna wanna first compare the protocols
and methodologies and see do they have, like for example,
the Sustainable Accounting Standards Board
has industry specific methodologies.
So if you’re an industry covered by that,
maybe that one stands out to you or you know,
maybe a lot of your peers are reporting through, you know,
GRI and so you wanna pursue that.
But I think you know,
choosing to disclose to a given body like isn’t essential.
And you also really just have the option
to make your reporting public on your website
and put your impacts out there in that way.
So you know, there’s a lot of systems out there,
but I would say it can be overly complicated
and it shouldn’t be a hindrance to getting started.
So you know,
I think there’s a lot of challenges
with some of the different software tools
in terms of traceability and transparency, right?
If you’re doing this math for the first time,
you really want to document the process,
you wanna document your assumptions
and how you did that math
and that’s something you don’t always get out of,
out of like a SaaS solution.
So I hope that answered your systems question,
but if you wanna build on it,
I’m happy to dig further on that.
So the next question is, you know,
I’m curious about bridging the gap
between typical Scope one and Scope two,
carbon focus and corporate sustainability
and the more holistic LCA Scope three type thinking
you’re talking about here.
And then part of the challenge I see is communicating
and reasoning on more complex data.
How do you compare for example,
emitted CO2 and consumed water
and biodiversity impacts to make the best decisions?
Alright, a multi-parter, so I’ll do my best.
In terms of Scope one, two, and three
you know, there’s, so there’s really like a life cycle
focused approach to Scope three
that doesn’t necessarily refer to doing an overall
like life cycle assessment,
but it’s more looking at individual ingredients
and things like that or individual inputs.
And again, so much of the complexity
of how you approach Scope three
is really going to lean on what type of industry you are in.
The greenhouse gas protocol is a really valuable place
to start in terms of digging into best practices
for Scope three emissions.
So for example, in the case of you’re making a product
that has, you know, sugar as an ingredient
and you’re sourcing the sugar from you know,
let’s say you’re sourcing the sugar from somewhere
in Europe, like is there data out there that you know,
provides an emissions factor
for the manufacturer of that sugar?
And then you’re also looking at the transport of that sugar.
So you’re not necessarily looking at you know,
the full end of life of that,
you’re really looking at your consumption of that input
as well as your receipt of that input.
But definitely I would say like the most robust
kind of protocols out there around Scope three emissions
really fall under the greenhouse gas protocol.
So if you haven’t dug in there, highly,
highly encouraged using that as a resource.
And then, you know, reputability of emission factors
is a really important consideration, right?
For Scope one and Scope two,
a lot of those emission factors you know,
are published by you know, even new like EPA.
So the Environmental Protection Agency has published,
you know, a number of grid factors
for use for electricity emissions,
but there’s less out there for some of those
like niche emission sources.
So when you’re looking for emission factors,
if you can find emission factors that have been you know,
that are in literature and peer reviewed you know,
those might be, might be the best choice.
But again, it really depends on the nature
of what you’re quantifying
as well as what guidance is most appropriate.
And it, you know, it can be tricky to navigate
and I would say like, you know, having support resources,
whether they’re doing the calculations
or even third party verifying
if you’re doing the math in-house,
can be helpful in validating
that you’re calculating emissions
in terms of best practices.
The next part of that question, I would believe was,
I believe was around communication
and the reasoning on more complex data
and how do you compare carbon water
and biodiversity impacts?
And I think part of this actually traces back
to materiality, right?
Where everything in this space has trade-offs.
So maybe you’re sourcing an ingredient
from as close as possible as you can,
but you’re in a really drought ridden region,
or maybe you’ve chosen a specific packaging
because it’s lightweight.
So the carbon footprint is going to be less
when you transport your product, but it’s less recyclable.
So you really have to look at which of the issues pose
highest risk to you,
which are things that are highest priority to you, right?
And when you do a materiality assessment, you can even,
you know, you can make the results of that.
Like you can share with your stakeholders,
whether it be in reporting or other channels,
which topics are most important to you,
what goals are most important to you, right?
Like if biodiversity is a paramount focus to you,
then maybe you’re making trade-offs
in favor of biodiversity,
but like unfortunately we’re not in a space yet
where there’s like a magic bullet solution
that is the best thing for waste carbon and water.
So everything typically has a trade off
in talking about those trade-offs
and like why you chose them
and how that thing aligned with your goals
can be a really good way to you know, engage people
in how you’re going about things,
how you’re approaching things as well as driving change,
Like if everyone in your industry
is facing those same challenges,
is there the opportunity to collaborate
even though your competition to drive better solutions
because you’re all really facing that one trade off
that maybe you can solve together or you can push
for bigger brands to solve as well.
So that’s kind of why I personally believe
the importance in talking about trade-offs
because you know, they’re everywhere unfortunately.
And what’s the best decision for your business
in relation to your sustainability goals
might not be the same decision that your competitor makes
like, and that’s okay, but it’s just,
it’s really important to kind of identify your why
and go from there.
Okay, I think that covered all the questions.
I’ll give another moment or so for more to flow in,
but I really appreciate everyone taking the time today
and working through these.
And I also wanna call your attention to the QR code here
to subscribe to our sustainable progress newsletter
where you can stay,
stay tuned on upcoming webinars and events
as well as content that we put out.
All right, well I hope everyone has a great rest of your day
and take care.
In addition to the full replay above, below is a quick summary of all of the questions and answers I covered during the webinar.
As a small business just beginning our sustainability journey, which cost-effective strategies should we consider for integrating sustainability into our operations to make an immediate positive impact?
For any small business at the outset of their sustainability journey, my first advice is to start taking action, however small. Identify stakeholders within your organization who can champion this cause. Next, take stock of your current standing; understanding your status quo is crucial. Remember the adage, what gets measured gets managed. To start, you might calculate your carbon footprint or assess your water usage. From this baseline, you can begin to formulate a sustainability strategy and implementation plan tailored to your operation’s specific needs. It’s important to remember that each business is unique, so each sustainability strategy will be unique as well. For instance, the quick wins or “low-hanging fruit” for a manufacturing operation are likely to be vastly different from those of an office space. If you’re an office-based business, your main emission source could very well be electricity usage. Tackling this could offer a great starting point. So, essentially, the journey begins with understanding your current state, and then identifying and pursuing the most effective sustainability strategies for your specific operations.
How can we use the results of a materiality assessment to inform our sustainability strategy and drive meaningful change within our organization?
Materiality assessments can provide critical insights to inform and shape your sustainability strategy. They highlight the environmental, social, and governance (ESG) issues that matter most to your stakeholders and could significantly impact your business. The key is to align the results of your materiality assessment with your strategic decision-making. This alignment allows you to focus on the areas of highest impact and importance, essentially helping you prioritize your sustainability initiatives. Remember that transparency in sharing these results with stakeholders can help build trust and engage them in your sustainability journey.
How can we develop a holistic sustainability strategy that not only focuses on decarbonization but also addresses other critical aspects like water and waste management?
A holistic sustainability strategy goes beyond carbon and encompasses other critical areas like water and waste management. Here, your materiality assessment can guide you in identifying and prioritizing these areas. Each industry and company have unique sustainability challenges and opportunities, so what’s crucial is aligning your sustainability strategies with your core business goals and values. For example, if you’re in a water-intensive industry or located in a water-scarce region, water management might be a key focus area. Simultaneously, waste management is crucial for industries with significant material throughput. The end goal should be to create a sustainability strategy that’s truly holistic and integrated with your core business strategy.
How can we build a more sustainable supply chain by identifying, collaborating with, and ensuring our suppliers and partners are aware of and share our commitment to sustainability?
Building a sustainable supply chain involves understanding your supply chain’s current state, including the sustainability performance of your suppliers. You can begin by setting expectations for your suppliers around sustainability, possibly even including sustainability criteria in your contracts. Engage in regular communication and collaboration with your suppliers, and provide them with the necessary training and resources to enhance their sustainability performance. Remember, it’s not about policing your suppliers but rather collaborating with them to advance mutual sustainability goals. Supplier engagement can be a slow process, but it’s a crucial one in the journey toward building a more sustainable supply chain.
Carbon Accounting & Reporting
Our business is growing rapidly. How can we measure progress towards improving our impacts when our overall footprint is expanding as our business grows?
Even as your business grows, you can track your progress toward sustainability by focusing on emissions intensity metrics, which measure your impact relative to a certain business activity or output. For instance, you might consider your carbon emissions per unit of production or per dollar of revenue. This approach allows you to monitor your performance and improvements over time, irrespective of business growth. It also gives you the flexibility to set meaningful goals that align with your business’s growth trajectory, rather than just absolute reduction targets.
How can we report in a way that’s transparent and positive while avoiding greenwashing? Our leadership team is worried about disclosing our impacts.
To avoid greenwashing, be honest and transparent in your sustainability reporting. This includes acknowledging where you are today, even if it’s not where you’d like to be, and sharing your plans for improvement. Use credible, widely accepted standards and frameworks for your reporting, such as those from the Global Reporting Initiative (GRI) or the Sustainability Accounting Standards Board (SASB). These standards provide guidance on what to report, how to measure your impacts, and how to communicate them effectively. Stakeholders appreciate transparency and the acknowledgment of areas for improvement. So, embrace your starting point, outline your journey, and let your stakeholders join you on this path.
How do we account for Scope 3 emissions in our carbon footprint calculations and what actions can we take to reduce them?
Scope 3 emissions typically represent a significant part of a company’s carbon footprint and arise from sources not directly controlled by the company, such as suppliers, customers, or employee commuting. To account for these emissions, you’ll first need to identify and understand your Scope 3 sources. Tools like the GHG Protocol can guide you in this process. Once you’ve identified these sources, consider which ones are most significant and where you have the most influence. Here, collaboration with your suppliers or customers can play a key role. For instance, you could encourage suppliers to reduce their emissions or work with customers to promote the use of your products in a more sustainable manner.
How do we set realistic and impactful sustainability goals for our organization?
Setting realistic and impactful sustainability goals involves understanding your current situation, defining what success looks like for your organization, and then mapping out the path to get there. Start with a baseline assessment to understand your current environmental impacts. Then, determine where you’d like to be in the future. This vision could be informed by science-based targets, stakeholder expectations, or industry best practices. Once you have a clear vision, you can set shorter-term goals that will guide you toward this long-term ambition. Remember, it’s important that these goals are both ambitious and achievable, and they should be integrated into your overall business strategy. It’s important to align these goals with broader sustainability frameworks, like the United Nations (UN) Sustainable Development Goals (SDGs).
Our company has achieved carbon neutrality. What are the next steps to strive for (e.g. carbon negativity)?
Achieving carbon neutrality is a significant accomplishment, so congratulations! The next step would be aiming for carbon negativity, which means removing more carbon from the atmosphere than you emit. This could involve investing in carbon removal projects or exploring ways to sequester carbon within your operations. However, it’s important to balance these efforts with a continued focus on reducing your own emissions. Ultimately, the aim should be to create a resilient, sustainable business model that thrives in a low-carbon economy.
When choosing carbon credits to offset our emissions, how can we choose high-quality carbon credits?
Selecting high-quality carbon credits involves a few key aspects. First, ensure the project you’re investing in is independently verified by a recognized standard, such as the Verra Carbon Standard (VCS) or the Gold Standard (GS). Next, the project should demonstrate additionality, meaning the carbon reduction wouldn’t have occurred without the project. Finally, consider the co-benefits of the project. Does it benefit local communities or biodiversity? A reputable carbon offset provider like CarbonBetter can guide you in identifying suitable projects that align with your sustainability goals and values.
We’ve done the math for our Scope 1 and 2 carbon footprint and want to offset that to achieve carbon neutral. Where and how do we buy carbon offsets?
Once you’re ready to offset your Scope 1 and 2 emissions, you can purchase carbon credits from various providers. These could be non-profit organizations, environmental consultancies, or dedicated carbon offset platforms. When selecting a provider, consider their reputation, the standards they use to verify projects, and the range and quality of projects they offer. Remember, your choice of offset projects should align with your company’s values and sustainability goals. Achieving carbon neutrality through offsetting can be a powerful step in your sustainability journey, but it should complement, not replace, efforts to reduce your own emissions.
Navigating the path to sustainability can seem complex, but you don’t have to do it alone. Whether you’re just beginning your journey, aiming to improve your carbon accounting and reporting, or looking for effective ways to set and achieve ambitious sustainability goals, CarbonBetter is here to guide you. Reach out to us today to get started.
Nicole Sullivan leads CarbonBetter’s climate practice, helping organizations measure, reduce, offset, and report on environmental impacts, including carbon emissions, water, and waste.
At CarbonBetter, we believe in progress over perfection. It’s not about doing everything—it’s about doing something. With over a decade of experience in the energy industry, we partner with organizations to guide them in the transition to a net-zero economy. CarbonBetter’s sustainability specialists work closely with partners across all industries to integrate sustainability solutions seamlessly into any business.
Telling stories about sustainability efforts helps other organizations take action that will then, in turn, inspire others—it’s never too early or late to start.