CleanTech WebLog

In a free market system, the profit motive is considered to be the main reason why businesses exist. The concept is that everything a company does, now and into the future, is aimed at the ultimate goal of earning a profit. Even apparently altruistic corporate social responsibility initiatives have the ultimate goal of ensuring the company’s financial success by burnishing its image, creating loyal customers and employees, or otherwise paying off in future profits.

If that’s true, then why would companies bother tracking – or beyond that –
reporting their greenhouse gas (GHG) emissions?

There are many rational reasons not to track GHG emissions, such as:

• too many other business priorities
• no government requirement to report
• takes staff time to gather and analyze the data
• emissions estimation process is confusing
• publicly reporting emissions may make the company a target for activists
• too many different reporting agencies and protocols
• cost of membership in a GHG registry and cost of data verification, where required.

Yet, the number of companies voluntarily participating in the California Climate Action Registry (CCAR) doubled during the last year. As of 2/15/08, there are 327 members.

Clearly one of the driving forces behind this membership growth is impending regulation. In September 2006, Governor Schwarzenegger signed into law California Assembly Bill 32 (AB32), the California Global Warming Solutions Act. This act calls for a reduction by 2020 of GHG emissions to 1990 levels. Among other things, AB32 mandates reporting, with the details of “who, when and how” to be specified by the California Air Resources Board (CARB) of the state’s Environmental Protection Agency. In December 2007, CARB issued its proposed mandatory reporting regulation specifying which business segments must begin reporting in 2009.

So, the vast majority of new CCAR members were likely motivated by the belief that, sooner or later, they would have to start reporting their emissions.

Still, a handful of other companies signed up, too. We asked Gary Gero, the interim president of CCAR, why. Gary acknowledges that the main reason companies join CCAR is a “risk management strategy.” Even companies not initially required to report see regulatory compliance on the horizon. They are searching for answers and ways to move forward. They know they must understand their inventory of emissions and devise plans to deal with it. CCAR offers help, tools, education and a community of other companies facing the same challenges.

Interestingly, once CCAR members begin tracking their emissions, they start to look at the financial implications, begin to monetize their emissions and start to identify operational inefficiencies and monetize them. According to Gary, “A lot of businesses may be tentative at first, but as soon as they start tracking their emissions it’s like putting their toe in the water and finding out it’s not so bad in there.”

Going green doesn’t happen all at once.  It’s a continuum.  Every business, like every person,   can do something that conserves, recycles, saves, and re-uses. 

How does a company create sustainability in their organization?   First, assess what’s going on, to identify areas for improvement.    Start small, with  a recycling program, or by  creating employee incentives and rewards for using public transportation, or carpooling, or hybrid vehicles. Reduce power consumption where it can be done with relative ease.  Start a program with IT to turn off or down computers and lights at night. Change the lightbulbs!  Buy carbon offsets to mitigate things that are more difficult to control, like travel for salespeople. 

When you’re ready to dig deeper, look into how emissions can be reduced, then measured and reported.   Join the CCAR (California Climate Action Registry).  Check out your county’s Green Certification program; most California counties have them or are developing them.  If you have company vehicles, start specifying those that use hybrid technology or biofuels. 

Not everything can be done at once, but as you move along the continuum, changes can be made further inside the company.   Look at your supply chain and the partners in it; there are almost always ways that transportation and packaging can be improved.   In manufacturing, opportunities abound: to get rid of materials that have toxins, to recycle more, to use technologies already in place to streamline processes.   Product lifecycle management, ERP, and asset management software all can play a part in this without making sweeping changes to existing practices.   Small changes, consistently practiced and added to, will cumulatively change an organization’s impact. 

And, whatever you do–measure it!   Set goals and targets and report on the progress to all the stakeholders.

At the greenest end of the continuum, sustainability is integrated into all the company’s work, from product design to buildings.   That’s where we are headed.   And as we walk the path that takes us there, each action is a valuable step along the way.

I saw the first episode of the new series called “Startup Junkies” a couple of weeks ago.   It’s a reality/documentary show that details the lifecycle of a startup company, in this case a company called Earth Class Mail.   Two cool ideas converge here— the series itself, which for those of us addicted to entrepreneurial ideas is great fun, and a creative idea for replacing the US Postal Service.   That’s what I call an audacious goal.

I love the idea.   Your mail, instead of being delivered to your doorstep, is delivered to a warehouse where it is scanned and an image of each item is sent to you by email.  Then, you decide whether to 1) open it and look inside 2) have it sent directly to your doorstep 3) destroy/recycle it.  This all happens electronically without you touching anything.  It’s innovative, and it’s already working.   CEO Ron Wiener has done this before—this is his fifth startup and he sounds like he knows what he’s doing.

The premise of Startup Junkies is that we get to see how he’s doing it.  He and his team lived with a camera crew for an extended period of time,  and that became an eight-episode television show.   It’s somewhere between reality show and documentary, with a healthy dash of PR as a side benefit.  It’s fast-paced and fun to watch—you can see it on Mojo TV or at  http://www.mojohd.com/mojoseries/startupjunkies.

There’s some controversy over whether this is a “green” technology. I believe it is.  It’s a productivity aid for people who travel or who just don’t want to spend time handling mail.  It’s  carbon saving in that it consolidates a fuel-intensive activity.   (According to Earth Class Mail, the post office is one of the country’s largest consumers of energy.)  Sure, there’s machinery, and there’s transportation involved.   But compare that to the mail an average business sends to a landfill.  How much space and how many employees are devoted to physical mail services in a very large business?    Earth Class Mail has set a goal of recycling 200 tons of paper in 2008—which represents 90% of received mail.  The average person today recycles about 20%, and I’ve seen statistics for businesses as low as 5%.  It would be ideal if fewer pieces of mail were generated in the first place, and in time,  that will happen.  By then I suspect Ron Wiener will have another big idea.