Saturday, July 11, 2009

Lower carbon intensity – yeah, right

I am no environmental expert, but I shudder every time I read CR reports by businesses that they are bending over backwards to reduce carbon emissions and extolling the praises of every single carbon-emission-reducing project, and in the next breath we read that their absolute carbon emissions have increased. Am I just naïve or is there something wrong with this system? Do all these businesses who are growing and increasing their carbon footprint year on year think they are positively contributing to climate change just because their emission levels per store, per truck, per refrigerator, per hamburger, per trip, per cup of coffee, per banana, per printed CR report or per pair of underpants is less than it was a year ago ? I mean, who do they think I am? Dumbo? (ok, they're not sooo far off). Who are we kidding here?

Take a quick look at Tesco in the UK. 2009 CR report. This sentence: Over the past year our net sales area grew by 16.4% while our carbon footprint increased by 3.7%. This means we cut our carbon intensity by 10.9% year-on-year. I did a little research. In the last two years their sales area has grew by 16.2% % and carbon emissions increased by 14.7% . This is almost no carbon intensity reduction. Who cares about carbon intensity anyway? We should care about absolute emission levels.

OK, so who else?

IKEA provide a comprehensive breakdown of total carbon emissions in their latest CR report for 2008 and show that carbon emissions have INCREASED YEAR ON YEAR EVERY YEAR for the past 4 years. But here is how IKEA present this: "The total amount of carbon dioxide emissions directly related to IKEA operations increased in FY08. However, in relative terms, the development is positive. When one examines carbon dioxide emissions per total products sold, we see an overall positive improvement compared to FY05. " Positive ? Is "relative" going to save the planet?

One more:

DANSKE BANK. Carbon emissions increased from 54.1 to 65.2 ktons 2008 vs 2007.An increase of 20% and from 2.9 to 3.5 tonnes per FTE. In a section entitled "Continuing to improve our impact" and full of green jargon such as "towards a low-carbon future" , "carbon neutrality" and "1 tonne less" campaign" , the actual results of all these words and efforts is exactly opposite.

CR reports are very valuable for assessing carbon management performance. I applaud all the above and thousands others who report, and who are making efforts to support climate change. But the focus has to shift from words to clear decisive actions which result in absolute lower carbon emission levels. Sadly, we are still caught up in the intensity of it all and cowering behind the relativity of ghg statements. Maybe we should be relatively more intense and focus on relatively more results?

elaine cohen is the joint CEO of BeyondBusiness, a leading reporting and social-environmental consulting firm . Visit our website at:


Lucia said...

This is a very good point. I've often thought about this discrepancy as well. The main explanation is there is no way you can have economic growth (=increase in output, jobs, etc.) without increased use of resources. I do wish we figure a way. And soon.

Lucia said...

Here is another blog post about the same dilemma with an example from Wall-Mart. The comments are interesting.

Marlys said...

I understand what your saying and the IKEA example is really annoying, but this situation reflects the fact that we are in a transition and some companies are doing better than others in actually reducing absolute levels. The intensity measure is a valid one and to the extent it can be reduced that is good, but those very reductions can then be overwhelmed by regular growth. Given we are not in a major recession, it is unusual to think that market growth is enough to neutralize the reduction in carbon intensity measures.
A company must articulate a coherent strategy for reduction over time and show that they are seriously integrating this strateguy into their operations. IKEA is not that kind of company apprently. A recent NPR article was not complimentary of this company. The carbon intensity measures help to rank on a relative basis how companies are doing, which is helpful for investors to look at, since it is impossible to avoid companies who have emissions. A good db to look at emissions as well as strategy is the CDP (Carbon Disclosure Data) where companies need to articulate their strategy, not just quantify year over year emissions changes.
I appreciate the examples you put together.

elaine said...

thank you Lucia and Marlys for reading and for your good comments. i find it hard to accept that one cannot grow business without increasing absolute emissions. The baseline is so high that it should be possible to reduce the baseline whilst expanding operations so that overall totals are at leastm maintained if not reduced. There are some leaders - take this quote from the Intel 2008 report, for example:
Since 2006, Intel has been a member of the EPA’s Climate Leaders program, an industry-government partnership working to develop strategies to reduce overall climate change. In conjunction with the program, Intel set a goal to reduce our total worldwide greenhouse gas emissions by 30% per unit of production from 2004 through 2010. As of the end of 2008, we were on track to meet this goal, having reduced emissions 40% below 2004 levels on a per chip basis. In 2008, we set an additional goal to reduce the absolute carbon dioxide (CO2) impact of our operations 20% below 2007 levels by 2012; we are currently on track to meet this goal as well.
I am sure there are many other examples like this. Let's hope there will be more. Thanks again for commenting.

Galit - Lynn Stiklaro said...

טוב, אני לא אגיב ואכתוב כמו קודמיי,
פשוט אומר שכתבת פוסט מאוד מעניין
שמחתי לקרוא :)

elaine said...

היי גלית
תודה על התגובה
שמחתי שקראת!
את הראשונה שמגיבה לי בעברית!
האתר והעיצובים שלך מאוד יפים ומקוריים

Galit Lynn Stiklaro said...

שמחה להיות הראשונה :)
תודה רבה על מחמאות.

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