Ecobusiness-Exchange

Biodiversity generally refers to how many different types of Living things are in any particular place and the different habitats that support them It is impossible to define an accurate economic value or know the number of species that exist. What we do know, is that human made mass extinction is in progress.

Biodiversity conserves water supplies, protects against inland and coastal flooding, removes millions of tonnes of CO2 from the air, and provides habitats that nurture the pollinating insects that many food crops depend on. As well as providing pleasant environments that refresh people’s physical and emotional health.

At this point you might be thinking; How can my business affect Biodiversity?

Have you encountered the tender question that says ” how is your business mitigating Biodiversity loss?” If you are working in manufacturing, oil, construction or farming you probably have the answer. For the rest of us here is:

A Pragmatic Approach to Biodiversity

1. Ask questions of your supply chain: when you next place orders for furniture, flooring and stationery ask if the supplier complies with forestry conservation standards and for proof that the products are from renewable sources.
2. Tree Planting and Community days: use your corporate social responsibility program to encourage staff volunteering to engage in Tree Planting programs often run by charities or local authorities to create new habitats and increase populations of local wildlife.
3. Garden Projects in the community: find new projects for community gardens that include wildlife gardens and engage your staff to help. It adds to the habitats for wildlife and gets teams working together improving staff morale.
4. Spread of the Built environment reduces biodiversity: encourage hot-desking and mobile working to reduce your needs for office space. Will also cut down on energy and lighting costs and reduce CO2 emissions. Mitigate the effects of the building by planting local plants and tree species in and around office buildings which will attract pollinating insects such as Bees and Butterflies and birds.
5. Recycle or disposal of WEEE: poor disposal has led to groundwater pollution problems from PCB’s which eventually finds its way into rivers and water sources. Ensure you have a reliable contractor to dispose or recycle your electrical and computer waste.
6. Biodiversity and CSR: you could promote the campaign for Non-meat days- not eating meat for one day a week reduces the amount of rainforest destroyed for meat production. Or invite the RSPB or WWF in to raise staff awareness of Biodiversity and encourage fund raising activities.
7. Offsets: If you have done everything else you can think of; cover all your bases by extending your activities by buying offsets or investing in overseas projects that protect or enhance biodiversity.

Last year the government gave up on its target to halt the loss of UK Biodiversity by 2010. That doesn’t mean it’s not important- poor management can lead to real loss and damage as BP has recently experienced. Small changes by large numbers of businesses can make an impact and change futures.

Resources

WWF ; Get Your Business Involved

RSPB ;Corporate Support

Valpak WEEE Recycling Provider

Carbon Offsetting at Carbon Footprint Ltd

Community Projects: Business in the Community

The Designing out Waste Consortium in association with the Green Alliance has published their latest report: A Pathway to Greener Products

In the report the nine consortia members including ASDA, Boots Unilever call for Greener product policies:

• The development of a standard methodology for evaluating and communicating product impacts to replace confusing and non-standard Carbon Footprinting.
• Support for EU product standards that go further than energy efficiency and consider issues such as durability, material use and recyclability.
• Creation of sector targets and baselines to enable companies to measure their resource efficiency which will enable consumers to make more meaningful comparisons.
• Development of ‘Upstream’ fiscal and regulatory measures to encourage companies to design out waste. At the moment the only tax on wasted resources is at the point of disposal….

How do you apply fiscal measures to waste Upstream – Before it becomes waste?

Unlike the other points this was not expanded upon in the report. So here are a few suggestions on how to achieve a result:

Introduce a new VAT scheme for materials, paper steel etc; organizations which are able to claim VAT back will not be allowed to claim on the quantity of material they have disposed of as waste. This has practical challenges as materials will need to be measured.

Introduce a water efficiency scheme: similar to the Carbon energy efficiency scheme. Enterprises buy water credits based on industry best practice. If they use less they can trade, if more than they have to buy the shortfall and excessive use may result in fines.

Compulsory membership of NISP: All companies that manufacture products should join the National Industrial Symbiosis program NISP. One man’s waste is another’s product; NISP provides a free service to match companies who produce waste with those who can use the materials in their processes or products.

A national waste reduction campaign: Why pay for something you are throwing away? Name and shame on the London Stock Exchange those organizations whose waste bills are increasing. Introduce a resource efficiency measure that aligns growth with materials use- those with greater growth and less materials use are a better investment prospect.

Government sponsored competitions; a technology prize open to those companies that can show they have re-designed their products to reduce their environmental impacts by more than 15%. The best company products are rewarded with government contracts and business loans.

It’s a challenge to create practical methodologies that address materials efficiency. Frameworks such as the The Natural Step (TNS) have been around for a while. It requires some effort and a culture change to get organizations to address environment at the design stage and its going to be the process experts who probably have the answers. Enterprises such as Unilever and Waitrose incorporate environmental considerations into their design processes and use it as part of their go to market strategy.

What can the government do to eliminate waste upstream and downstream?

 

More information

The Green Alliance Homepage

A Pathway to Greener Products; Download the report

The Aldersgate Group recently called for Carbon Disclosure reporting to become mandatory for all business. If this is adopted then reporting is going become a challenge for every size of  business. Can technology help business make this an easier task and can Software As A Service (SAAS) make it less of a financial pain?

The consulting and services market is growing rapidly and there are at least 81 companies listed in the ENDS Online Directory of environmental services providers. So far no single market leader has emerged, perhaps this is about to change as a product from the SalesForce.com stable has recently hit the market called CloudApps.

CloudApps is offering reporting and carbon management software.  Built on the Force.com platform which is also used by the Salesforce.com product; Cloud Apps is delivered as a SAAS solution. It is claimed that it integrates to back-office systems such as Human Resources, Finance and Travel and Expenses and metering. The system offers business analytics capabilities and enables reports to be automatically generated to meet the requirements of the Carbon Reduction Commitment and the Carbon Disclosure Project. Most solutions available will enable you to compare and analyse the performance across your business.

CloudApps offers some additional functionality over and above reporting. This solution enables collaboration and sharing of information and ideas in a secure environment. The system enables one to deliver information created in the system to individuals, or post directly onto the intranet. The product has a collaborative platform that uses social media to securely engage the workforce in carbon reduction efforts and share and develop ideas using an automated viral approach.

If you are looking for more than just reporting and want to give your environmental program an edge it’s worth a look.

If you are interested in testing this service; CloudApps is offering a free trial for 30 days.

CloudApps Free Trial

More environmental services providers can be found at:

Ends Directory 

Ecobusiness Exchange has no commercial relationship with CloudApps,  and would be interested to hear from those who have experience of using their products and services

It’s a tough market out there at the moment. There are a large number of companies bidding for a small number of opportunities. This blog has talked a lot about competitive advantage: from some of the bids  that have passed through my hands this week- It appears  that Corporate Social Responsibility is becoming a key part of many  requests. Most UK organisations are still working out their response to the Carbon Reduction Commitment and will flounder when they receive a twenty page request from a financial institution that requires them to break down their emissions by more than scope 1, 2, or 3.

The most challenging question I have seen this week was ‘please supply a map of your global supply chain’ which came from a global charity. I can only guess at their objective in asking the question. The answer to the question was not supplied because:

a. Too difficult

b. Too commercially sensitive and

c. Not commercially viable to get the answer

How are organisations going to compare and score the answers?

Unless specialists are reviewing the bids there is a strong chance that this is a tick box exercise. This does not really encourage suppliers into acting with a purpose regarding their environmental impacts. Recent reports say that the number of CSR jobs is increasing- that means more people available to create meaningless questions.  It would be useful if we could agree on some industry standards to introduce some consistency and meaning into the measurements.

In the meantime, to stop your business from being overwhelmed, try the following:

• Compile a database of commonly asked questions and answers; Sant provide some excellent software for managing bid responses.
• When answering questions consider the motives of the organisation asking the question; for instance if you are a plumber bidding for some work at the local bank  and they ask you about mis-selling prevention take it with a pinch of salt!
• Create an annual CSR report for your organisation which details your aspirations, environmental statements and policies and any KPI’s you have. Use this as supporting evidence for your statements.

Environment is a serious issue it would be a tragedy if it was reduced to a procurement tick box exercise.

What’s the most ridiculous CSR question you have had this week?

The last government did try to create standards by industry – should the coalition revive the idea?

The Aldersgate Group this week called for Mandatory Carbon Reporting- this blog supports mandatory reporting with the view it would save time and provide a standard- do you agree?

Helpful links: Sant bid Software

If your organisation is headquartered in the UK you are probably already engaged in measuring your scope 1 and 2 emissions to meet the requirements of the CRC (Carbon Reduction Efficiency Scheme). Perhaps you have this process nailed down and it’s painless. Or like some organisations it seems like hard work gathering information from multiple locations for compliance purposes. A task made more difficult for organisations that are engaging in mergers and acquisitions or adding locations.

Wouldn’t be interesting if we could transform measurement into a cost saving or cost neutral exercise?

There are consultancies that will manage the CRC reporting for you. Another approach is to use the information gathered for the CRC to negotiate better procurement rates with your utility provider.  One company that is offering that service is NUS consulting. They will for a small monthly subscription manage the process of gathering information on your energy usage by working with all your locations across the world. This will deliver the information for the CRC and also provide useful information on how much energy the locations are using enabling one to make comparisons and implement cost saving programs.

That’s the tricky bit- funding those energy saving initiatives

 NUS  is a major multinational provider of procurement services specialising in utilities. If you haven’t previously entered into a procurement exercise with utilities you are in for a pleasant surprise. A medium size UK company recently went through this exercise and was able to save on their utility spend by about 10 times the NUS fee. NUS say that this was exceptional but on average they would expect clients to get a return on fees of at least 3-1. This is a good way of gathering your emissions data across the world and potentially saving money.

Sounds too good to be true?

There is a caveat; to make the procurement savings you do need to be responsible for the relationship with the utility provider. Which is more likely if the building is owned, or there is a relationship to the supplier through the landlord. Or you could negotiate with the landlord and the other tenants to get them engaged in a tendering process. Landlords are becoming more enthusiastic about reducing their tenants consumption as they have obligations to meet under the CRC.

In previous blogs we have looked at the business case for environmental action and there are few quick wins. Coupling your utility procurement with measuring your emissions seems like a profitable quick win that Finance Directors are likely to embrace.

More information on NUS Consulting

To significantly reduce our emissions we need to think of new ways of doing business that benefit consumers and achieves our needs of reducing emissions and conserving resources. We are living in a society where products are upgraded to the latest and best versions which we are then persuaded to buy with little thought given to what happens to the discarded products. Others in society have little access to technology and have a reduced quality of life. Products are recycled reluctantly by manufacturers who view this as a business cost and not an intrinsic part of their business.

Edward De Bono’s latest book “THINK- Before it’s too late” suggests new ways of thinking that will improve our lives, and to do more than just fix what is broken. One of the concepts used for generating new ideas is to take an existing concept and apply it to something else.

This sparked an idea that may reduce our environmental impact and provide some competitive advantage: take the concept of “software as a service” SAAS- well known in the world of IT and apply it to product- PAAS. In the SAAS model;  companies or individuals subscribe to a software service delivered remotely e.g; SalesForce.com, pay monthly and have the service for as long as they want. They are not delivered a product but consume the service across the internet.

PAAS- Product As A Service

One could pay a monthly subscription for the product to the service provider who provides the product as part of the service delivery for the length of the contract. At the end of the contract the service provider takes back the product and either recycles or reuses it for another client.

This type of service is starting to emerge:  mobile phone providers provide a phone with a monthly contract and regularly upgrade the phone as an encouragement to stay with them. This model could be improved if they took back the old phones at the point of the upgrade or contract end. Then re-used or recycled them by giving to other contract holders at a lower cost or recovered components.

This model has a number of benefits:

• The scarce materials in the phone are reused.
• Provides greater access to mobile technology at lower cost potentially for users in developing countries where access to mobile technology can save lives.
• Delivers an enhanced reputation to the provider and helps secure limited resources as the precious metals used in phones are likely to be in future short supply.

Predictable Revenues and More Recycling

If you are a retailer looking to secure your market share and gain some competitive edge; imagine having your customers signed up to an annual spend commitment with you.

As a consumer: imagine if your favourite supermarket- Tesco’s, Sainsbury Asda or Iceland provided you with a fridge or a freezer as part of an annual contract for grocery spend. You pay monthly and at the end of the contract period return or upgrade the appliance. The appliances could then be re-used by being offered at a lower cost to another customer. The appliance makers can benefit by partnering with the food retailers who also act as a channel to market for their products. This reduces their cost in going to market and could increase their market penetration if they partner with the right one.

Instead of being persuaded to buy the latest product and throw away the old one. The appliances become part of the service. They need to last longer, be reparable and re-useable. This could mean more appliances re-used or recycled and less to landfill. For businesses this could offer predictable revenue streams and lower cost of sales.

In 2007 Kravis Kohlberg Roberts (KKR) a global alternative asset manager partnered with NGO The Environmental Defence Fund (EDF) to create The Green Portfolio Project. This was designed to significantly improve the environmental and financial performance of their portfolio companies. The Green Portfolio Project  provides a simple framework for identifying Key Environmental Performance Areas, Establishing Metrics and Baseline, Developing Goals and an Action Plan, and finally measuring and reporting results.

Implementing this program resulted in lower fuel, water and energy costs plus reduction of  their waste disposal costs and new revenue streams for the particpants who in the first year saved $16.4m.

Dean Nelson of KKR Capstone said   “one of KKR’s core strengths is driving operational improvements that build business value. We are focused on improving environmental performance across our portfolio and providing a framework to help companies take environmental initiatives to scale.”

Last week KKR released an update on the Green Portfolio project which has been rolled out to another 12 companies.  After two years of operations the first 8 to report have saved over £160m in operating costs.

It has been extensively reported that organisations who have been ahead of the curve in managing their environmental impacts have been weathering the recent downturn better than some others. This is sometimes attributed to better risk management  processes which if fail can have a dramatic impact on shareholder value- as BP have found out to their cost. There is also a growing body of evidence that better environmental performance is valued by consumers and this has enabled firms to outperform their peers.

The Green Portfolio approach is available to all companies and can be downloaded from EDF’s website at:

http://www.edf.org/page.cfm?tagID=1465

Are you a large public company or a public sector organisation looking at options for funding your energy or environmental improvement project? How can you get low risk funding?

Answer: Find an ESCO* Energy service company who will work with you to help create the project, Fund the debt and share the risks and rewards. It’s not a new concept, ESCOs have been around in the USA since 2006. In the UK the concept is undergoing a revival as a way of assisting a struggling public sector meet their obligations to reduce their carbon footprint.

At the recent Base Conference held at London Excel Jon Miles Director of Public sector at Royal Bank of Scotland- RBS entreated the audience to bring him the projects- he would work with  the client and ESCO to develop the funding plan. In these difficult times, it’s refreshing to see offers of funds from bankers. RBS has been interested in this market for some time: In 2005 they set up a joint venture with Sempra commodities called Sempra Global Solutions. The London Development Agency is supporting refit projects by providing information for public sector bodies and introductions to a network of ESCO partners who could work with RBS.

The prize on these projects can be substantial: A refit on the Empire State Building by Jones Lang Lasalle will bring the owners a return of $4.2m per annum. KKR a private equity company rolled out a project in 2007 to three of their invested companies that yielded savings of $16.4m.

Finding a UK  ESCO for a non private sector company is a challenge. There are a number of USA ESCO companies with UK presence like Siemens and Chevron and Honeywell.

Once the Carbon Reduction Commitment is established organisations will take the next step from reporting to finding ways to implement energy savings. This looks like a great opportunity for UK ESCO’s to scale or USA companies to expand.

If you know of a good ESC, or are an ESCO please leave a comment and Eco-business Exchange will publish details.

Definition ESCO from Wikipedia

An energy service company is a professional business providing a broad range of comprehensive energy solutions including design and implementation of energy savings projects, energy conservation, energy infrastructure outsourcing, power generation, energy supply and risk management. The ESCO performs an in-depth analysis of the property, designs an energy efficient solution, installs the required elements and maintains the system to ensure energy savings during the payback period. The savings in energy costs are often used to pay back the capital investment of the project over a five to twenty year period, or reinvested into the building to allow for capital upgrades that may otherwise be unfeasible. If the project does not provide returns on the investment the ESCO is often responsible to pay the difference.

Sources

London Development Agency

Siemens UK

Chevron Energy

Energy Saving Trust

Jones Lang Lesalle

Wikipedia

 “The implications of a new world order are changing our world, the way we live, our politics and our economy. To take advantage businesses need to be alert to the new order and challenge existing thinking”   says a new report by BDO UK

BDO a leading consultancy, collaborated with business leaders and strategists to analyse future changes in the world markets. The report; New Economic World Order identifies future trends and market changes accelerated by the recession.

Due to the impact of recession in the UK, it is probable that the future for growth will come from exports. The economic trading conditions mean that traditional trading partners such as Germany, Spain, France may eventually be replaced by China, India and Mexico.

Business is unlikely to return to “business as usual”. The attitudes of consumers are changing dramatically. This is good news for businesses that have been using sustainability as a framework to increase their business success and a wakeup call for the rest. BDO describes how consumers are shifting their values away from aspirational purchasing towards more conscious spending decisions which are driven by a search for meaning and value. The “feel good” factor seems to be a growing trend as consumers want to be altruistic through their spending choices. The growth of Fair Trade products is clear evidence of this trend.

Creativity and innovation essential for success will be driven by increasing the levels of employee engagement. Employee engagement is rapidly becoming an important concern to business as the UK market eases out of recession. A recent survey by Hays group reported that 59% of employees are only staying with their current employer till the market frees up. A recent comment from one senior executive stated 20% of our employees have left but are still seated at their desks! The corporate responsibility program in an organisation can work towards engaging employees and creating a positive culture that will drive innovation. In a business on the Green Journey that innovation could create new sustainable products and services.

BDO envisages that the need for competitive advantage will drive business towards collaboration. This is an established business practice in Pharmaceuticals, one of the UK’s major manufacturing sectors.  Other accelerating trends are flexible working, technology as an enabler, a focus on enterprise risk management and virtual organisations.

 I recommend reading this report for an insight into future market trends and hints on how to capitalise on the future opportunity for sustainable business.

I would be interested in your comments as to how business can capitalise on the opportunity and what the real threats are.

Find the BDO Report at:

http://www.bdo.uk.com/library/transitions

Having planned a campaign to reduce your environmental impacts, the first step is to establish  the baseline emissions. In an organisation that does not manufacture, this would be scope 1 or 2 emissions which are from purchased Gas and Electricity and Transport.  

If you are lucky you will have had a good response to the initiative and found some enthusiasm to take up the challenge. Watch out as you push at the open door you don’t fall over the barriers that will stop you achieving your goals. Sometimes voiced as ;

This is too difficult, too complex, we don’t get the utility bills and we have numerous locations.

Our systems are fragmented and it’s too difficult to collate emissions from transport- is it Fred or Joe who had those bills?

You could upgrade all your systems to address these issues- the technology is out there. Or you can take a faster, cost effective route and outsource.

To meet requirements for the Carbon Reduction Commitment organisation need to measure their scope 1 & 2 emissions. Some have outsourced the process of collating information and preparing the management information. This has additional benefits, if your partner is NUS Consulting who can also re-negotiate your energy tariffs at the same time. This saves money and provides a good return on investment. Outsourcing reduces the amount of time spent by the organisation meeting their obligations under the CRC. The information gained is essential in planning energy saving projects to improve league table positions.

 Measuring emissions from fleet and business travel is a challenge especially from company car drivers and those who have car allowances. Organisations that have grown quickly and have disparate systems struggle to get a single set of information and have to combine information from fuel cards, expenses systems and Fleet.

Expenses, Fleet Systems and Travel solutions that measure CO2 emissions are recent innovations. To save the cost and get accurate management information consider outsourcing your transport systems. Travel booking providers such as BCD offer Online systems and MIS that will enable you to access sophisticated reports showing CO2 travel emissions by person, journey, purpose, method etc. Providing the information to complete the baseline and also put in place travel policies that will help reduce the emissions, cost of travel and track the whereabouts of your employees globally.

Recent innovations in expenses systems have included the ability to compare  the CO2 of a journey before travel so the traveller can take the most efficient route. Calculate the emissions of a different makes and models of vehicles to produce comprehensive and detailed reporting. Outsourcing the expenses process also removes the need to store all the paper and receipts for 7 years!

Changing the way organisations do business is always a challenge. To encourage people to change; sponsorship from the top and an enthusiastic champion for the program helps significantly!

Resources

NUS Carbon management services

Expenses solutions NorthgateArinso

BCD Outsourced Travel