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Taking the pain out of carbon measurement

Author: ICAEW Insights

Published: 04 Oct 2023

Ecologi’s technology solution plugs into accounting software to give companies a carbon footprint baseline from which to base an emissions reduction strategy, but measurement is only part of the challenge.

As the UK government looks to row back on green pledges, including pushing back the ban on the sale of new petrol and diesel cars to 2035, net zero progress – or lack thereof – is once again firmly under the spotlight. 

For Steve Dickenson, Senior Enterprise Account Manager at Ecologi, now really isn’t the time to be taking our collective foot of the proverbial gas. Even before Rishi Sunak’s recent announcement about changes to the government’s green policies, Dickenson was muted in his optimism for progress towards net zero targets. “We’re moving in the right direction but we’re definitely behind. So we have to accelerate. We’ll get there, it’s just what we will lose in the process, depending on how quickly we do it,” he says.

Ecologi is on a mission to inspire and empower businesses to accelerate global climate action funding reforestation and climate solutions through its marketplace, subscriptions and ecommerce products. With more than 40,000 customers including 20,000 businesses, it has funded planting in excess of 71 million trees around the world and avoided more than 2.8 million tonnes of CO2e.

“We’ve got a saying in Ecologi: ‘What isn’t measured cannot be managed,’” Dickenson says. The company’s latest technology, Ecologi Zero, plugs into Xero accounting software to track transactions and apply an emissions factor to automatically create a carbon footprint. 

Ecologi integrates data from Small World Consulting, founded by Mike Berners-Lee (the brother of internet pioneer Tim), an expert on carbon footprinting and a professor and fellow of the Institute for Social Futures at Lancaster University. “We’ve been using their proprietary datasets to inform typical emissions for those different categories across scopes one, two and three,” Dickenson explains.

In very simple terms, scope one and two are the emissions you have control over in your organisation. Scope three is your supply chain. Once you’ve got the data, you can start to make informed decisions about the best reductions strategy to pursue based on your hotspots. Dickenson says: “Emissions reduction should always come first before any level of mitigation – the path that we recommend is calculate, reduce, fund. Ecologi customers can share that story with clients, customers and other stakeholders using a public impact profile dashboard.”

Taking the pain out of the all-important measurement aspect is a huge step up in the emissions reduction journey, Dickenson says. “A big barrier for small businesses, and even medium businesses, is the cost to measure your carbon footprint. There are a lot of consultancies out there charging pretty hefty fees. And it’s time consuming.” 

For larger, more complex footprints, Ecologi works with affiliate consultancies including Eight Versa following what Dickenson describes as a rigorous selection process to identify similarities in climate ethos, value set and culture. Although Ecologi works for organisations of all sizes, including large enterprises such as AXA, Vodafone and Lloyds Bank, the majority of its 20,000 business customers are SMEs and Dickenson is acutely aware of the bumps they face in their journey to net zero.

Dickenson believes that knowledge remains a barrier for businesses genuinely wanting to do the right thing and get started on their climate journey. “So many organisations and individuals want to do something, they recognise there’s a need, they feel passionate about it, and they recognise that their business model is having a negative impact, but they don’t know where to go. 

“First and foremost, they don’t know how to do it and they don’t know who’s credible, which has led to climate anxiety. Who do I work with? Who can I trust? How can I be sure that my money is going towards the right kind of projects?”

Carbon offsetting is one area fraught with misunderstanding, Dickenson warns. “Offsets offer a mechanism to get much-needed funding to projects around the world that are helping prevent further emissions. When offsets are implemented alongside real emissions reduction strategies, they’re a vital tool for solving climate change. But in isolation, they’re not enough. 

“The single most important marker as to whether the world can meet the aims of the Paris Agreement is rapid and permanent decarbonisation. So reducing emissions should always come before relying on offsets.” 

With companies under growing pressure from all quarters to tell a good impact story, greenwashing and lately “green hushing” are a risk. “Greenwashing is when you know that you’re not doing the right thing, or you suspect you aren’t, but you’re claiming that you are. Provided you tell the truth, people will forgive those shortfalls because of that transparency.” 

Oatly is a great example of a company that has taken transparency to the radical end of the spectrum with a dedicated website – fckoatly.com – documenting in warts-and-all detail the challenges in realising its mission to shift consumers away from dairy.

In the case of many SMEs it’s often unintentional, Dickenson says. “We help guide businesses as to what they can and can’t say via our business climate toolkit and communication guidelines. Transparency as part of both your culture and marketing communications strategy is key. In practical terms, that means being honest about what you’re doing, highlighting where you’re good but also accepting where you’re not so good and recognising where there is still more work to do.”

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