Feeling an increasing sense of urgency about when to start your businesses’ journey to net zero? Blue Marble’s COO Tim Kemp explains why the moment is now.
As if running a company didn’t come with enough stressors, the requirement to respond to the climate crisis is putting additional heat on business owners. When should they start their road to net zero? Is it better to wait for legislation which forces the issue or to act sooner to be prepared for the inevitable requests from stakeholders and potential customers?
Beyond the most basic requirement to avoid disastrous climate change, or to be ready to meet the needs of those you supply, it’s also worth thinking about how not being carbon savvy could affect the growth of your business. If you plan to raise investment on a business that’s carbon heavy, it’s worth noting that it’s likely to be viewed as extremely vulnerable to future carbon taxes.
Conversely, acting quickly provides the benefit of potentially getting ahead of the competition, and you’ll also enjoy the positive associations that come from being seen to do the right thing. It makes sense to start scaling your footprint down as soon as is viable.
Blue Marble’s COO, Tim Kemp, is no stranger to answering business owners’ questions on when to start the journey; he’s had numerous conversations with those who’ve approached Blue Marble looking for help. We asked him to explain the process Blue Marble follows with new clients, and to clarify how straightforward it is.
What to measure?
‘We always look back over a period of 12 months, which gives us something to measure against, year-on-year. When that year starts is entirely up to the client: it can be the financial year, the calendar year or any date they choose, as long as there are 12 clear months of figures to analyse.
‘First we look at the company structure. This is to understand what they have direct control of and what they’re able to change to reduce their carbon output. Depending on their structure, we decide if we are going to break down financial or operational factors – whichever is more appropriate. These decisions help us account for subsidiaries and joint ventures, and to define the organisation to be measured.
‘Scope’ is a word that comes up a lot and we use it to explain the different areas of control the client has, and how these areas affect their carbon output.
‘Scope 1 represents the elements that the business directly owns or controls. For example, if they own an office and have control over the gas boiler, this would be in Scope 1. If, however, they run their business from a shared office space in which they have no control over the heating, that would be outside their Scope 1 as they have no agency to make reductions.
‘Scope 2 covers emissions associated with energy the business buys ‘over the fence’ i.e., where they don’t create the emissions from its generation. More often than not, that’s electricity but could be heating, steam or compressed air.
‘Scope 3 covers emissions that happen as a result of the businesses’ operations, but which it doesn’t directly own or control. This is where companies that have a go at doing the carbon accounting process themselves run into trouble because they often don’t understand what they’re required to consider or what they can exclude legitimately.
‘It’s important to understand that companies are not expected to include absolutely everything in Scope 3 but should be transparent about what is covered and what is not.’
What to include
‘Determining which Scope 3 factors should be included is about understanding how important they are to the running of the business. For example, a company providing online teaching doesn’t have direct control over the emissions that result from the hosting of its website, but it’s key to their business, so you might consider that. Yet, in the case of a building contractor that happens to have a website, you probably wouldn’t include the emissions from its web hosting as the website is not a core part of their business – and the emissions associated with it proportionately small. A good test is to consider how much data is available on any area. There’s no point trying to take account of the emissions of the company in China that dug the coal that was used to melt the steel to make your chair – it’s just not feasible until everybody accounts for their footprint in that way.
‘It’s also key to consider what’s important to the businesses’ stakeholders as they may take a view on what should be accounted for.’
When is the best time to begin?
‘Quite a few people tell us things like: ‘I’ve got plans to buy some electric cars this year, so we’d like to do this next year after we’ve made those changes.
‘They should actually start before they make those changes. A businesses’ footprint on the journey to net zero should be (roughly) a 4.2% reduction per year but if you create your initial baseline after you’ve already picked all the low-hanging fruit, the journey to net zero is going to be a lot harder. The earlier you capture your baseline, the easier the transition is going to be. A number of companies have told us they wish they’d started the process some time ago.’
How does the process work?
‘It usually only takes about six weeks to do the audit and create the plan, but this does depend on how engaged the business is on chasing down the information required.
‘First, the client meets with me or one of my colleagues and we have a fact-finding meeting. Then we use those findings to create a bespoke questionnaire about the company activities, we can also support them with additional questionnaires they can pass on to employees to help capture their commuting and home-working routines.
‘Once we receive that information, we put it into our model, calculate the footprint and then issue the report. This explains how the calculation was produced, how the footprint for the year is broken down into the different scopes, and reveals the various ways they can reduce their footprint for the year to come and beyond.
‘As the report initially calculates the year that’s already gone and won’t be affected by changes put in place, the next consideration is whether they want to achieve carbon neutrality for that year. If they do, we can offset the carbon emitted through an approved offsetting project. This can be anything from developing renewable energy systems across the world to protecting areas of rainforest from logging.
‘We also work with more unusual solutions that physically remove carbon. Carbon char is one: during logging, trees are stripped down and the wood for planks removed, while the branches are left to degrade, creating carbon dioxide of which only a small amount is locked into the soil. However, the alternative is for the branches to be collected and put in a pyrolysis kiln, where it is heated in the absence of oxygen, which stabilises the carbon. This char can then be put back into soil, locking in carbon while also improving the soil and helping with drainage.
‘The business will receive information about the projects it’s supported and get the retirement certificates for those projects.’
How does the business demonstrate they’re on the road to net zero?
‘We provide our clients with Blue Marble logos and marketing collateral such as certificates which they can use to show they have been carbon assessed. There are a number of options, from simply being assessed once to becoming a ‘carbon neutral organisation’ which means the client has chosen to offset for the preceding year, and ‘carbon neutral and committed’ which mean they’re already carbon neutral and are committed to maintaining that status until a certain date.
‘All the businesses we work with are included in the member area of the site, so if they are looking for a carbon neutral supplier, they can see what each business has included and improved. It’s a great way to find like-minded businesses to work with, while simultaneously reducing your Scope 3 emissions – which facilitates your own net-zero plan.‘
What happens if the report recommends very expensive measures?
‘We are pro-business and non-judgemental. We wouldn’t suggest, for example, that a business get rid of a 4×4 pickup that’s ideal for the job to replace it with an electric one with lower emissions that doesn’t suit the purpose. The best solutions are those practical ones that don’t impact on the business and even saves it money, and that’s what we aim to deliver.’
The Blue Marble process
- Initial fact-finding meeting with client
- Creation of bespoke questionnaire and materials to help client collect
- Data modelled and report produced
- Client acts on findings and decides whether or not to offset for year in question
- Plan put in place for current year and beyond
- Client joins Blue Marble directory and becomes visible to other likeminded businesses, and benefits from associated brand boost