Understanding what a carbon footprint is is crucial for modern businesses. By quantifying greenhouse gas (GHG) emissions, a company can better manage its environmental impact. This approach is not just a descriptive exercise, but a strategic tool that promotes regulatory compliance, cost reduction, improved brand image, risk management and innovation. In short, the carbon footprint is essential for any company wishing to make a lasting commitment to the fight against climate change and prepare for future challenges.
What is the carbon footprint? We all associate an image with a word or a subject, and this evocation is different from one person to another. This understanding, influenced by many factors, can prevent us from taking advantage of certain analyses because they may not have been sufficiently explained to us.
The carbon footprint may well fall into this category. We are going to define the process and the terms associated with it, explain what it is used for, how it is useful for your company and how it is carried out.
The carbon footprint assessment is an estimate of your organisation's contribution to global warming caused by the increase in the concentration of greenhouse gases in the atmosphere and accentuated by other phenomena, through systemic interactions.
It would therefore be more accurate to speak of a greenhouse gas balance or carbon equivalent balance. Various gases are said to have a ‘greenhouse effect’ because they help to retain some of the energy brought to earth by the sun and emitted into space by the earth. Part of this energy is captured, as in a greenhouse. The principle is exactly the same, hence the name.
The notion of carbon equivalent represents the conversion of the warming power of one tonne of each greenhouse gas into its carbon equivalent.
The carbon (equivalent) footprint therefore consists of identifying and estimating the greenhouse gas emissions for which your organisation is responsible in the course of its business.
What is the purpose of a carbon (equivalent) footprint?
The purpose is twofold. On the one hand, it's a descriptive exercise that helps you understand the sources of emissions linked to your activity, where they come from and what the orders of magnitude are. It's an overview.
Secondly, and no less importantly, it identifies the actions you can take to reduce these emissions.
A brief diversions into what are known as ‘scopes’. There are three of them, and they depend on how close the emissions are to the company's perimeter.
Very briefly, we can say that:
- scope 1 represents direct emissions generated on site (combustion of gaseous, liquid or solid fuels, refrigerant gas leaks, etc.) and within the company's direct perimeter (fleet of vehicles used directly for the activity).
- scope 2 covers indirect emissions linked to energy not produced on site (e.g. purchase of electricity or steam produced by a third party)
- scope 3 covers all other indirect emissions that are not under the company's control: upstream value chain (products and services in the supply chain) and downstream (through to use by the user and end of life).
How does a carbon (equivalent) footprint assessment work?
There are three stages in carrying out a carbon (equivalent) assessment:
- defining the scope of the assessment
- collecting the data and carrying out the calculations
- interpreting and drawing up recommendations for action.
The scope can take different forms. We can study a company in its entirety, just one site, just the production sites, a business unit, the company's facilities and activities in a country, a product range, and so on. The choices made at this stage determine the scope and complexity of the work to be carried out. As the aim is to understand the company's climate impact and take action to reduce it, the choice of scope can also influence the relevance of the assessment.
Data collection is the part that mobilises the most internal resources and accounts for the largest proportion of the total time devoted to the project. The complexity of the organisation, the structure of its information systems (which does not necessarily mean IT systems) and the way in which the organisation can make itself available will determine the complexity and duration of this stage. The calculations are made on the basis of the information collected or, where certain precise information is not available, using approximation methods.
The results are interpreted by the consultant and explained to the client. The combination of the analyst's expertise and his or her understanding of the company enables him or her to draw up recommendations for action that will offer the company the opportunity to reduce its emissions in the long term.
What are the benefits of a plan to reduce greenhouse gas emissions?
- reducing your contribution to climate change means helping to reduce the associated risks to your business. This is both an altruistic and a selfish goal, as the two are linked.
- a significant proportion of greenhouse gas emissions come from the combustion of fossil fuels; reducing your emissions means reducing your consumption and therefore your costs
- the implementation of concrete, verifiable steps to reduce emissions is an interesting area for communication, and one that will enhance your company's brand image.
- European regulations are imposing new constraints which, although they apply primarily to large companies, are also having an impact on smaller organisations. Indeed, large companies have to show their progress, which they do by working internally but also by mobilising their value chains. In this way, making substantial improvements themselves creates a new form of competitive advantage
- the introduction of a carbon tax will, depending on the price set, have a direct influence on your cost structure and therefore on your profitability; studying your balance sheet and taking action to reduce your emissions therefore amounts to protecting yourself against this new risk
The company must protect itself against the consequences of climate inaction, as described in the last chapter on the virtues of greenhouse gas emission reduction plans. To achieve this, it is important to describe, understand and act.
Whether your motivation stems from a personal desire to take action in the face of the climate challenge, or is the result of an analysis of the risks facing your company, carrying out a greenhouse gas emissions assessment is an effective tool. It will give you a fresh look at your organisation and provide solutions for individual and collective benefit.
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