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Designing a carbon strategy is currently a central topic for many companies. Indeed, a large number of initiatives are emerging, such as The Climate Pledge (led by Amazon) to strive for carbon neutrality.
The reasons that drive companies to integrate carbon emissions into their strategy can, however, be diverse. Whether it is to gain or retain market share, align with current and future regulations, attract investors, or reduce financial and climate risks, all companies have an interest in factoring their carbon emissions into their long-term strategy.
But how do you go about it? What are the necessary steps to implement a solid and coherent carbon strategy ?
First of all, you need to know exactly what you are emitting. How can you effectively reduce something you haven't quantified? To do this, conducting a carbon footprint assessment is essential. It is the first step in any carbon strategy.
Once you have created an accurate snapshot of the carbon emissions produced by your company, you can identify your emission sources and thus implement an action plan to reduce them.
After implementing your action plan, it may be that some of your carbon emissions cannot (or cannot yet) be avoided; in this case, it is possible to offset them. This means purchasing carbon credits from projects that develop carbon sinks.
The final step is to track your carbon emissions over time to adjust your trajectory, if necessary, and thus reach the goals previously set.
Step 1: Conducting your carbon footprint assessment
Every choice has an impact on a company's carbon emissions: using one type of flour over another, the choice of energy supplier, the location of your site (which may result in a longer commute for employees or be better served by public transport)... Various and diverse characteristics therefore influence the amount of carbon emissions produced by a company, and the role of a carbon footprint assessment is to account for them.
What is a carbon footprint assessment?
A carbon footprint assessment lists the greenhouse gas (GHG) emissions generated by a company or organization. This includes carbon dioxide, of course, but also other gases with global warming potential, such as methane (mainly emitted by ruminants) or nitrous oxide. However, to be able to compare all these gases, they are converted into a quantity of CO2 equivalent (written as CO2e) based on their global warming potential. For example, methane has 25 times the impact on global warming as carbon dioxide, so 1 kg of methane is equal to 25 kg of CO2e.
How is a carbon footprint assessment structured?
A carbon footprint assessment is governed by frameworks such as the Bilan Carbone© method, the GHG Protocol, and the ISO 14064 standard to ensure a consistent approach.
It is organized into three parts, known as scopes:
- Scope 1 consists of greenhouse gas emissions resulting from the consumption of carbon-based fuels. This includes diesel used in your vehicle fleet, refrigerant fluids, or heating oil consumption.
- Scope 2 covers carbon-equivalent emissions generated by the consumption of other energy sources. Purchasing electricity, heating, or steam results in indirect greenhouse gas emissions because carbon-based materials were consumed during their production. These materials are accounted for indirectly, as the simple act of consuming electricity does not directly emit greenhouse gases.
- Scope 3 includes all greenhouse gas emissions not related to energy consumption. This can include the purchase of raw materials, waste management, business travel, and all upstream and downstream logistics.
Carbon emissions are therefore classified into three categories, and it is essential to account for all sources, whether upstream or downstream. This means that emissions from your suppliers, as well as those resulting from the use and end-of-life of your products, are also attributable to your carbon footprint.
Once your carbon footprint assessment is finalized, you will know the amount of greenhouse gases your business emits. Now, it is time to reduce those emissions.
Step 2: Reducing your carbon emissions
To align with global agreements, particularly the Paris Agreement on climate change, it is necessary to reduce your carbon emissions as much as possible.
To do this, you must set goals that meet the scale of the climate challenge and then create a clear, detailed action plan to achieve them.
This action plan will depend on your industry and your specific emission sources. Every action plan is therefore, in a way, unique. Nevertheless, there are several common practices you can implement within your organization. We’ll share them with you right now!
Electricity
Using electricity from renewable sources is a simple and effective way to reduce your company's carbon emissions.
Furthermore, the use of energy-intensive servers is becoming increasingly widespread, which impacts your carbon footprint. However, there are greener servers available that aim to reduce their carbon impact.
Suppliers
For many companies, the majority of their carbon emissions come from the products and services they purchase. You can therefore encourage your suppliers to commit to carbon reduction initiatives or, if they refuse, switch to a more eco-friendly supplier.
This is becoming standard practice in the industry. Microsoft, for example, has drafted a clause requiring all its suppliers to take action to combat global warming.
Employee travel
Employees generate significant carbon emissions, whether through their daily commutes or business travel, and this is part of your carbon footprint.
It is possible to drastically reduce the carbon emissions from business travel by adopting new work practices such as video calls or collaborative software. If these trips cannot be avoided, it is essential to carefully choose the mode of transport for your meetings. Trains are the most efficient option for long distances and can easily replace flying; prioritize them to reduce your greenhouse gas emissions.
Additionally, implementing a remote work policy can reduce emissions caused by your employees' daily commutes. Be careful, however: remote work is not a miracle solution and depends on many factors. Take the test to see if remote work is beneficial for your organization.
Workplaces
Your company's premises can also be a source of significant carbon savings. Optimizing heating, ventilation, or lighting are relevant actions to include in your action plan.
Workplace catering can also be a site for carbon reductions. Offering more vegetarian meals and significantly reducing beef consumption can also improve the performance of your company cafeteria.
Step 3: Offset unavoidable emissions
Reducing carbon emissions should always be a company's priority, and there are many solutions for fighting climate change. Nevertheless, there will always be emissions that cannot be completely eliminated, or at least not immediately. This is why it is possible to support the development of high-impact projects in exchange for carbon credits. The idea behind these credits? You fund a portion of a project that develops carbon sinks through donations, and in exchange, they provide you with carbon credits that "offset" the carbon emissions you were unable to eliminate.
Step 4: Tracking your carbon emissions
Conducting a carbon assessment and creating an action plan are the first steps in a long-term process. You must repeat this regularly to track your emissions and visualize your progress. A SaaS solution like Tennaxia ESG allows you to quickly update your data and monitor the progress of your projects to build an ambitious climate strategy and effectively reduce your carbon emissions.
In short, whether to satisfy employees, investors, and consumers, or out of environmental concern, developing a corporate carbon strategy is essential.
Companies like Tennaxia are here to support you in this process, helping you reach your carbon reduction goals. Contact us for a demo of our SaaS tool.