10 Steps to Becoming a Carbon Neutral Business

Page 16 STEP 04: SET YOUR STRATEGY In each of the four workstreams, you will have to make some decisions about your strategy: / Which emissions will you focus on reducing internally? / How will you prioritize between RECs, PPAs and on-site installations to achieve a renewable electricity supply? / To what extent and which carbon credits will you invest in? Your GHG accounting process is a helpful starting point for defining the strategy. Once you know where your emissions come from, you will have an indication of where it might make most sense to start your reduction efforts. If you are a service provider that mainly has offices, your emissions profile will obviously be different than an industrial business. In this case, you may want to focus on achieving a green electricity supply as this tends to be a large part of the footprint. On the other hand, a manufacturing company may try to reduce the emissions which are usually associated with its operations, for instance waste or the delivery of materials to the factories. Beyond your emissions profile and ambition, the sector your company operates in should influence your strategy where possible. To put it simply, if you are a company manufacturing LED light bulbs, you may want to replace conventional lights with LED lights and clearly show the link between your core business and carbon neutrality. If you are a car lease company, you may want to green your own company car fleet and set an example for your customers. Walking the talk and leading the way, using your own products is a powerful commercial link to your sustainability initiative and can help drive employee ownership and pride as well as brand differentiation. Unless you start your program with a big bag of money in your hands, an important factor when designing the strategy is how your approach influences the financial payback of the program. Some emission reduction measures will have a relatively long payback period and this can become a challenge if you are funding most of your program through the company’s regular capital allocation process. It is key to identify the quick wins that can demonstrate the direct business value of your climate action program and build momentum that may help you get larger initiatives approved next time. Communication and employee engagement can be useful vehicles here. While the four workstreams can work somewhat sequential, they are more likely to run in parallel, perhaps even with different scenarios being explored simultaneously. The challenge is that your choices in one work stream influence the others so you will quickly appreciate the value of priorities and frameworks. This could be in relation to preferred approach to renewable energy supply or limitations on capital expenditures that will guide how you allocate resources and focus in your workstreams. Make sure you have one or more program manager(s) that can connect the dots and ensure the workstreams inform and enrich each other and stay coordinated. A significant reduction in electricity supply for instance has a direct influence on the requirement for Renewable Energy Certificates or the volume of electricity consumption that can be pitched for a PPA. A significant reduction in carbon emissions from other activities will influence the volume requirements for carbon offsets and therefore the prices you can negotiate.