SUSTAINABILITY – A GAIN OR A STRAIN?

Whether it is or isn’t, how do you measure up?

Amid the disruption of 2020 a phoenix has emerged from a stark reminder of our fragility. We have seen the mounting financial and physical toll of climate change in floods, fires, droughts and hurricanes and are being forcefully moved to confront the risks of non-action.

Companies are increasingly incorporating sustainability and environmental policies – according to KPMG in their Sustainability Reporting Survey of 2020i, a majority of companies have plans to reduce their carbon emissions, and there is a growing trend to link corporate carbon targets to global climate goals.

Business reporting on sustainability has also increased colossally; when KPMG ran their first survey in 1993, only 12% of businesses published sustainability reports, compared to 80% today, and 90% of the world’s largest companies.

The drivers behind this increase are varied – government requirements, civic duty, public pressure, and recognition that environmental factors have an impact on bottom lines, are all contributing factors.

With the increased trend for ‘calling out’ businesses on social media and an increasing cynical outlook for many denizens of the web, companies also need to be careful not to fall into ‘greenwashing’ territory (see 'Out in the Wash', below).

Although a business can always do something to increase their sustainable practices, without knowing your starting point and accurate measurements, it’s difficult to impossible to know what impact your initiatives are having.

Recognition of this issue has led to a wide range of offerings becoming available to help businesses measure their carbon footprint, from online calculators to independent assessors, whatever your industry.

An online tool that may be of benefit to businesses is www.compareyourfootprint.com. This offers free annual results if your revenue is under £300K and starts from £99 a year otherwise.

You enter your company data; they calculate your carbon usage giving you a starting point. By regularly updating your information, you can chart your journey of improvement and spot areas that could use more attention.

This is a particularly useful tool, as it doesn’t just measure your direct emissions, but also indirect emissions from the business, and all other indirect emissions from other activities in the organisation occurring from external sources. A business may find that they can drastically reduce their carbon footprint for minimal costs, just by switching to a renewable energy provider for example. There are, according to the university of Milan, five main ways to make sure that your company is sustainable:

1. Make sure you are within the national and international standards that govern your industry.

2. Measure the number of resources and raw materials that are used, and the amount of waste and emissions they generate.

3. What effect does your company have on the environment, community, and employees?

4. What is the life cycle of your product, and what is the supply chain? Can your product be reused or recycled at the end of its life?

5. Finally, what is the impact of your business in a social context – internationally, nationally and locally?

Listing these points is a lot easier than putting them into action, for which companies need staff, expertise, money and time; things that often aren’t readily available. However big changes can happen from small beginnings, and with the growing availability and simplicity of online tools, most businesses will be able to start measuring and making effective changes.

With 94% of UK businesses releasing sustainability reports in 2020, wherever your business is starting, it seems that sustainability reporting is here to stay.

Out in the Wash

Businesses know that they can capitalise on green credentials, however it pays to make sure that you can’t be accused of ‘greenwashing’. This is a practice of dressing something up as sustainable or environmentally friendly when it isn’t. For instance, when Starbucks responded to the straw backlash by creating a strawless cup that contained MORE plastic, or in 2020 when Shell, the global oil and gas company, posted an online poll asking, “What are you willing to change to help reduce emissions?” to a rather vicious, yet predictable backlash.

The drive for businesses to promote the positive environmental impact of their products and services, whether or not it’s completely truthful, is hardly a surprise. Studies from the Institute for Consumer Research and others have shown that a majority of consumers consider the environment when making a purchase, and around 70% would be willing to pay more for a product with green credentials.

But when it comes to employing eco-advertising, it’s not just the twittermob and ‘cancel culture’ that companies need to be wary of. In August 2021, the UK government launched an investigation into deals from UK energy companies that were branded ‘green’ or 100% renewable. This will be followed by imminently expected guidance on ‘eco-marketing’ from The Competitions and Market Authority.

It seems that if you do have a sustainable product and use green messaging, you will get more customers than non-green competitors; just make sure that your claims are accurate!