Innovating in Pursuit of Climate Action and Environmental Sustainability

by Avinash Lunj - UK Environment Manager by Siva Niranjan - Group Head of Environmental Sustainability & UK Head of Sustainability, Sopra Steria | minutes read

From reducing carbon footprint to improving energy efficiency, the surge of sustainable business continues to increase in prominence. To attract new business, talent and investment, companies are required to demonstrate, that they are putting their climate change strategies into action, to a wide range of stakeholder including institutional investors, regulators, clients and employees.

Most large companies have done this by reporting their compliance with regulation. However, companies that are pioneering forward-thinking sustainable business models by injecting creativity and innovation into their business practices are creating positive changes and reaping the rewards of business advantage. A report from analyst CDP reports that ‘corporations that are actively managing and planning for climate change secure an 18% higher return on investment (ROI) than companies that aren’t – and 67% higher than companies who refuse to disclose their emissions’.

With a timeframe of less than 10 years to avert the most severe impacts of climate change, there is an urgency around the scale of action and leadership required from every organisation. Here is an insight into how “Best-in-class” companies are going beyond business-as-usual.

1. Reduce emissions  

Plotting a path to clean growth: reducing your greenhouse gas (GHG) emissions against an increase in company activities starts with GHG emissions reporting. What isn’t measured isn’t known. Standards for reporting must go beyond minimum compliance expectations set by regulatory bodies.

Reporting GHG emissions provides a measure of a company’s performance. Reducing emissions provides a reflection of improved performance driven by:

  • adoption of the Task Force for Climate-related Disclosures (TCFD) reporting standards
  • ambitious long-term emissions reduction targets, complying with the global temperature rise limit to 1.5o C that has been approved by the Science Based Targets Initiative (SBTi)

 

…and enabled by:

  • putting an internal price on carbon
  • becoming a carbon-neutral company

2. Focus on energy 

For most companies a significant source of GHG emissions is energy consumption, whether in manufacturing products or servicing offices, factories, warehouses or datacentres.  Innovation starts with premises fulfilling high standards for energy performance (such as HQE and BREEAM) but goes further with an energy efficiency strategy that embraces:

  • procurement of renewable energy through the energy supplier and power purchase agreements
  • generation of renewable energy on-site, where practical
  • purchase of  renewable energy instruments such as Guarantee of Origin (GO) and International Renewable Energy Certificates (I-REC & REC) for electricity and Green Gas Certificates for gas

The expansion in the number of green power purchase contracts over the last 20 years shows that, like the US tech giants, large European companies are increasingly switching to renewable energy.

3. Reduce waste: the circular economy

The linear “take, make, dispose” economic model relies on having energy and virgin materials cheaply and easily available, but is reaching its physical limits. By reusing materials, a circular economy minimises the amount of resources that must be extracted and maximises the value of products and materials throughout their lifecycles.

Applying the principles of the circular economy could unlock up to EUR 1.8 trillion of value for Europe’s economy.  According to The Ellen MacArthur Foundation, business must play a central role in making the systemic changes required to unlock this value:

  • Designing waste and pollution out of processes
  • Keeping products and materials in use for more than one lifecycle
  • Regenerating natural systems by working with clients, partners and supply chain

4. Engage employees 

Reducing GHG emissions and participating in the circular economy require profound changes in the ways in which a company organises itself and operates. To change it must engage its employees in the need for change, and tap their creativity and initiative.

For example, it must

  • Inform and engage employees through employee ambassadors, specialists and partner organisations
  • Listen to employees, and, where practical, embrace and implement their ideas
  • Encourage employees to embed environmental sustainability in their day-to-day work
  • Support employee volunteering on environmental projects in the local community

 Establishing an Environment Management System (certified to ISO14001) to manage key environmental impacts (such as energy and water consumption, business travel, waste management, etc.) helps ensure that the effects of the changes are measured and monitored.

5. Engage the supply chain

Companies rely on their supply chains to deliver their contracts and meet their business objectives. In a globalised economy, a company’s GHG emissions from its supply chain can be as much as four times from its own operations, and so it must engage its supply chain in reducing its GHG emissions as much as its employees.

To do this it can

  • adopt a responsible purchasing policy, to promote the purchase of products and services with low environmental impact
  • leverage technological developments to reduce its overall environmental impact; e.g.  using blockchain technology to secure the supply chain
  • engage in the circular economy and thereby preserve resources
  • prioritise its supplier base on spend and risk for engagement in reducing GHG emissions
  • develop an engagement and support plan for suppliers 

In conclusion

Companies that weave innovative environmental programmes into the fabric of their organisations can realise these advantages, and go on to support the move on to a “net zero” economy for all.

External sources mentioned in the article:

(This article was published on Sopra Steria's UK website on June 5th 2020)

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