It’s all well and good to put our own house in order by cutting down on the direct greenhouse gas (GHG) emissions we create, but if we want to get serious about assessing the full impact of our business, we need to look beyond the boundaries of our own shop front.
Our carbon footprint doesn’t stop at our well-insulated, made-of-recycled-materials door. Or even at the tailpipe of our Prius or the runway of our fully-offset flight to Chicago.
It’s connected to every service provider, supplier, and shipping company that we do business with, as well as everyone they do business with, ad infinitum.
Tabulating our on-site emissions isn’t enough; we also need to account for and mitigate the GHG’s emitted in the production of each and every brick (length of wire, bit of plastic, pane of glass, etc.). Not to mention the source of the electricity that runs our computers and lights, any shipping associated with our business, and the disposal of products that we produce or retail.
This expanded eco-investigation is called Life Cycle Analysis/Assessment (LCA) when it accounts for a broad range of environmental impacts, and is sometimes called Enterprise Carbon Accounting (ECA) when it focuses solely on GHG emissions. The off-site emissions themselves are referred to as Scope 2 and Scope 3 emissions.
It’s a bit like trying to work out an extended family tree, where all the third cousins, great-grandparents and long-lost maiden aunts that we’ve barely heard of need to be identified and brought into line.
Managing the whole family is starting to look a little complicated.
‘we’re all learning, just like we all learned the internet’
So says Dr. Peter Graf, Chief Sustainability Officer at SAP (one of the world’s largest business software companies) in this useful video that discusses why businesses of all sizes need to start thinking seriously about their GHG emissions. So let’s take a step back in time to the early days of the internet.
Remember 28bps (or less) dial-up internet connections? Bulletin boards? Vast seas of black and white text in ugly fonts?
15-20 years ago the internet was clunky to use, its purpose and usefulness were unclear, and it was filled with ‘information’ of dubious value. Needless to say, the world has changed.
While there’s still plenty of questionable information online, for savvy users/businesses/publishers the internet has become indispensable. It is now essential infrastructure and has become virtually 
part of the air we breathe.
If we can crack the internet, surely there’s hope for sorting out this GHG family tree.
coming to grips with scope 3 emissions
You’re likely to need help with this, although some may be brave enough to rely on a well-executed Excel spreadsheet. But producing a carbon LCA of products and services is no easy task, and even big multinational conglomerates like Coca Cola and Intuit are seeking help in managing their carbon emissions.
The eco-marketplace has taken note, and a multitude of companies are scrambling to help. The key is data collection and management so that companies can accurately determine how to target emission reductions for maximum effect. And as with most data-intensive tasks, software tools and consultancy services can help immensely.
Here’s a sampling of what’s currently on offer, but expect this terrain to shift rapidly.
Companies like Hara and SAP are leaders in the field of proprietary ECA and LCA software, with Hara gaining the backing of Al Gore. Groom Energy offers a rather pricey report entitled ‘Enterprise Carbon Accounting: Analysis of GHG Reporting and Software’ for a more detailed analysis of available products and a list of 7 Emerging Leaders (the list is free on the same page). Their Practical Sustainability blog is also a good source of information on this topic.
There are also two free open-source solutions to carbon accounting: openLCA , which has a product available for download, and Earthster, which has not yet been publicly released. When Earthster does launch, in addition to internal LCA accounting it will enable companies to publish their non-proprietary LCA data for public access, allowing them to evaluate the environmental performance of their supply-chain. As increasing amounts of data are collected, this will open supply chains to public scrutiny. Joel Makower rightly refers to this introduction of ‘radical transparency’ as a potentially game-changing technology.
why bother with scope 3?
Here’s a longish answer from corporate environmental strategist Emma Stewart. She’s very thoughtful on a variety of issues faced by policy-makers and business leaders, but her most important take-home message is this: for most companies Scope 3 emissions ‘typically represent an exponentially larger footprint than their Scope 1 and 2 emissions . . . . Scope 3 emissions have become the atmospheric deal breaker.’ A useful reminder of what the real issue is here.
And then there’s Walmart. When the globe’s biggest corporate player starts examining the sustainability of its products, via its recently introduced Sustainability Index, the meaning of ‘business as usual’ begins to shift for us all. Walmart is edging towards LCA by querying their suppliers on the sustainability of their products, focusing on the categories of energy and climate; material efficiency; natural resources, and; people and community. The index, designed by the Sustainability Consortium that Walmart helped to create, is still rudimentary, but as Walmart’s 60,000 suppliers start cleaning up their act, ripples will be felt throughout the economy.
The big boys are engaging in LCA and the hunt for Scope 3 emissions. Watch out Grandma; we will find you!
