Corporate accounting is becoming cleaner and greener, as well as meaner. Environmental indicators are good way to appeal their coporate citizenship. The majority of companies that report their environmental footprints use the guideline issued by the Netherlands-based Global Reporting Initiative (GRI). Approximately 2000 multinational corporations consult the GRI.
It’s a voluntary scheme. Some reporting companies like to have their report audited by an external consultancy or an accounting firm. But their certifications carry no authenticity – auditors don’t assume legal liability for their opinions. And what about the issues that companies don’t fancy reporting? Companies still retain total liberty what to report and what not to.
Watchdog NGOs are established to monitor the sustainability claims pronounced by companies. One of them is Climatecounts.org, that developed scorecard assessment tools to see the performance on carbon emissions. This website classifies four aspects of corporate environmentalism: a) inventory of impact, b) actual reductions, c) policy stance, and d) reporting and accountability. I had a look at some of the famous companies, and sorted them to Good, OK, and Bad.
Good – Bank of America, Canon, GE, Nike, P&G,
OK – Amazon.com, Dell, Apple, Disney, Google, UPS, fedEx,
Starter – McDonald’s, Time-Warner, Sanofi-Aventis,
It’s also possible to sort by product types (eg. Bottled waters, PCs, etc), and by brands. They are not yet comprehensive so have to be filled in. Websites like this can offer concise and independent evaluations on allegedly green companies that suddenly picked up the hype a decade ago. Private green labels continue to proliferate. Questionable and unverified carbon offset schemes mushroom. If your mileage points go to planting trees.. can we be sure they’re really doing it for you? If you fly from Heathrow to JFK, that’s 1.5 tonne of CO2 for you, which translates to 2 non-tropical trees. The cost is not only about planting but also the land, stewarding, and potential natural/human disaster risks. I don’t believe extra ₤15 is enough for all these. The 2008 financial crisis occurred when we no longer knew the true risk of mortgage in the securitised products. A lot of green claims seem similar to this. A company suddenly became carbon-neutral because they made a new contract with a utility company which claims their energy source became 100% renewable, which was untrue but a mere emissions trading and offshore offset contracting, which was actually a futures product (they don’t do it now but will do in the future), which was about a chunk of land in a developing country whose land ownership regime was unclear, which leads to… Is this really a business innovation, or shouldn’t we go back to the business of actual reduction of resource use? In 2010, all developed nations announced that they 30% in excess of carbon emissions targets set by the Kyoto agreement (USEPA, European Commission and Japan’s MoE all confirmed this). The industrial sector as a whole is not doing its fair share.
The real breakthroughs may come from home energy usage. Metres to show the real-time power consumption of, for instance, dishwasher or the tumble dryer and their cost spikes. Conscious people would choose off-peak energy use. We don’t need everybody to be so environmentally savvy. But just imagine some million of people shifting their machine use by 30 minutes to less busy time.. the results will be exciting.
Wednesday 6 October 2010
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