World-class carbon management requires a chief sustainability officer, a cross-functional strategy for reductions with a 2020 target, coordinated business process changes and an integrated carbon management technology platform, according to a new study from research firm Verdantix.
Firms will fail to meet absolute reductions in CO2 emissions until CEOs look at carbon management as a business transformation challenge, rather than a corporate responsibility issue, says the researcher.
The report, “Best Practices Carbon Management,” provides recommendations on the development and implementation of a carbon business transformation plan. The study finds that companies need to change three key processes — energy management, financial planning to include carbon accounting, and facilities management — to achieve best practices for carbon management.
Here are four key strategies from the report to achieve year-on-year absolute reductions in CO2 emissions:
— Strengthen governance to deliver transformational change. This means hiring a chief sustainability officer (CSO) with a small Program Management Office that quantifies value and risk, co-ordinates initiatives and engages stakeholders. The CSO should be picked from a general management role internally, says Verdantix.
— Create a 2020 strategy for carbon management. Post-2020 firms need a transformation vision due to tighter regulation and increased customer pressure for sustainability credentials. Verdantix suggests working with climate change and sustainability advisors at firms like Deloitte and Ernst & Young to provide strategic input.
— Design cross-functional process changes across energy, operations and finance. In order to meet carbon emissions reduction goals across a variety of simultaneous projects, companies need to have a program in place that captures granular energy and fuel data, performs a financial analysis of projects and assesses for potential risk. The researcher cites consultants such as CH2M Hill, Scott Wilson and WSP Energy as those with expertise in project-related carbon and energy services.
— Implement integrated carbon management systems technology. Companies need accurate, timely and complete data on energy and fuel consumption, which requires both energy and carbon software, and metering systems that track energy consumption or refrigerant leakage at the asset level in order to reduce carbon emissions.