Tuesday, 20 February 2007

A Company's True Carbon Footprint

Christian Aid, a UK development charity, has just released a report that claims British companies are under-reporting their carbon emissions. They say that companies are failing to include the emissions from their outsourced manufacturing operations around the world.

This should not be a big surprise.

The standard that Carbon Clear uses to measure a company's emissions footprint, ISO 14064, breaks it down into three categories:
  1. Direct Emissions - resulting from activities under management control. This includes fuels burned in company owned factories, vehicles and offices.
  2. Energy Indirect Emissions - resulting from energy purchased by the company from third parties.  This includes electricity, district heating and cooling water.
  3. Other Indirect Emissions - resulting from activities by the company's customers and suppliers. This includes business flights, outsourced manufacturing, shipping and freight, service contractors, and customers who drive to a company's store across town, or who use a company's products in polluting ways.
Most companies focus first on their "direct emissions" and "energy indirect emissions". After all, this is the pollution that they can do the most to control. So Christian Aid is correct that company reporting usually only tells part of the story.

The British Government defends this reporting approach, saying that the country where the pollution occurs should be responsible for reporting it. Britain, they argue, should not be responsible for emissions from a factory in China when that factory isn't bound by British environmental rules.

At Carbon Clear, we feel that companies can do better. Knowledge is power, so we work to give our business customers a complete picture of their carbon exposure. We will always recommend ways to reduce the climate pollution - whether from their operations, from their suppliers, or from their customers.

Armed with this information, more and more of them are taking steps to reduce their entire carbon footprint.
Offsets are a useful tool in carbon management, in part because companies now see the cost of carbon on their balance sheet. This provides a strong incentive to lower their offset bill by reducing their own emissions, their suppliers' emissions, and their customers' emissions. As always, reduce what you can, and offset the rest.