Carbon Offsets and How To Simply Implement Them
If you are concerned about the environment and want to do something to help?
Perhaps, you don’t know where to start and you’re looking for a simple solution that isn’t going to take any effort to maintain.
There are various projects you could get involved in, but how do you choose which one?
Over the past year, I’ve partnered with Ecoforce Global run by Charles and Tracy Alder. You may remember them from the “Buy A Bale” program they instigated with the Rural Aid charity they created to help farmers during the drought.
They’re passionate about helping farmers and are on a mission to plant 1 billion trees by 2030 whilst supporting regenerative agriculture. The trees will all be planted on farmers properties and maintained by the farmer to ensure they grow to be big trees. By doing this, the trees provide carbon dioxide sequestration and canopy cover for animals, insects, and birds creating their own ecosystem within the forest.
I was talking to Charles just last week and they’ve just placed an order for 10,000 trees for one of the farms Ecoforce works with that will be planted in Spring 2025. I’ve lost count of how many trees have already been planted since they started the program.
Interested?
There are a number of ways businesses and people can get involved.
You can buy trees directly, whether paid in full or paid over twelve months, which I’d encourage you to do.
But there’s another super cool initiative that has just been launched in conjunction with Rounda. By using Rounda, you can have your debit or credit card purchases automatically rounded up to the nearest dollar, $2 or $5 with the rounding amounts added up and then allocated to buy trees at the end of each month. You also have the option to cap the amount of the rounding each week and you can pause the rounding at any time too.
Then at the end of the month, you’ll get a report that shows the amount of rounding you paid and how that’s been allocated to buying trees.
Cool, right? I think so.
To register for Rounda, click the link here.
If you’re interested to know more about how to join the Ecoforce Global group, click on the link here.
When’s the right time to start carbon reporting?
When’s the right time to start anything? There are a few options;
Be a Leader and start immediately. This might make you an early starter who will need to determine what to do and how to do it. This may require making mistakes, learning what works and what doesn’t work and making appropriate changes as needed.
By being a leader in undertaking carbon reporting and implementing carbon emission reduction strategies you create a story you can tell to your market and use as a competitive advantage to obtain more contracts and customers.
Be a Follower and wait until others have started. Let others learn and make the mistakes and find the best way to do it and then implement best practices from what the Leaders have learnt.
By being a follower, particularly if you’re in the early group of followers for your industry, you may still have a competitive advantage. Implementing carbon reporting and emission reduction strategies isn’t just about getting new contracts, it’s also about attracting employees who want to join a business where their values are aligned. Todays’ environmentally- conscious consumers are also future employees and those who will embrace the need to implement improvements into your business.
Be a Compliance Follower and wait until you are required to do it. By waiting until required to do it you will lose any competitive advantage.
By being a compliance follower you will tick the boxes for your contracts. You won’t have any competitive advantage for gaining new contracts and attracting employees who have an interest in the environment.
So, when is the right time to start? Perhaps the better answer is, yesterday. When you start will depend on the goals of the business, whether your business is a leader in your industry or a follower. It will depend on whether you have ambitious goals for the business or are content with the status quo.
What is clear is that decisions on business contracts will no longer be based on price, quantity, quality, service and reliability. The new key number that will be relevant to the decision will be the carbon emissions number.
What type of business do you have? Is it a Leader, a Follower or a Compliance Follower?
We are proud to advise that this article was written by the team and not produced by AI.
Check out how well your business is placed by taking the Carbon Readiness Assessment Now
The Push Down Effect
The Push Down Effect takes place when requirements of your customers or clients are “pushed down” onto your company. You in turn may “push down” those requirements onto your suppliers. This may continue down multiple levels like a cascade.
One instance of the Push Down Effect that we’re starting to see is in relation to carbon reporting. Large companies are requiring their direct supply chain suppliers to provide their own actual carbon emissions data. This is required under what is known as Scope 3 of the Greenhouse Gas Protocol, where Scope 3 accounts for all input costs other than fuel and electricity.
The Push Down Effect will become more prevalent in the coming months with the mandated requirements of large corporations to report their actual Scope 3 emissions. Coles, for example, announced in August 2023 that they will be requiring 70% of their suppliers by dollar value to provide actual carbon emissions data by 2026.
The challenge for suppliers is in requiring their suppliers to provide the same data. So, whilst the legislation refers only to large corporations required to report their carbon emissions from 1 January 2025, their suppliers and their suppliers will soon be caught up in the Push Down Effect.
Don’t wait until your clients or customers ask you for your data, leaving you to scramble around in a short space of time to meet their requirements. Better to be one step ahead and start carbon reporting now so that the information is readily to hand when you need it and you can also show what you are doing to reduce emissions.
John (not his actual name) came to me earlier this year after one of his overseas customers asked about their carbon footprint and advised that they were sending out a representative to inspect their business operations and discuss both their carbon footprint and the initiatives they’ve undertaken to reduce carbon emissions. He had already lost one potential new overseas client having been unable to provide the information they required as part of the due diligence process for their contract. He didn’t want to risk losing the existing customer. We worked with John and his team and put together a carbon report in time for the inspection visit. The inspector told John off the record that his business operations, his carbon report and initiatives for carbon reduction were the best he’d seen.
Are you going to be on the receiving end of the Push Down Effect? Are you going to have to start “pushing down” onto your suppliers too?
Want to learn more about how to get ahead of the Push Down Effect?
Join me on my free webinar to find out how.
The Clock Is Ticking For The Start of Mandated Climate-Based Reporting
In just three months, climate-based reporting will be required for some companies in Australia and it will impact medium sized companies.
Does your business supply to large corporations? Are you a freight company, manufacturer, or primary producer? Do you supply to hotels, mining companies or banks?
If the answer is yes, you need to start working on your climate-based reporting now as your customers or clients will be asking for the data before you know it. Not only will they be asking for the data, they will be asking what you are doing to improve the numbers to attain carbon net zero emissions in your business.
Preparing an initial carbon baseline report requires understanding the legislation and requirements, capturing the data and undertaking the analysis. It will take time to produce.
Now is the time to take action so that you have this reporting embedded into your systems and have identified strategies to reduce carbon emissions and a roadmap to get to carbon net zero over time.
There are two alternative courses of action. The first is to employ consultants to work with you to prepare the reports for you (and we can help with that). The second is to learn what you need to do to prepare the information internally in your business in this way empowering and engaging your team to embed process changes and efficiencies which will not only reduce carbon emissions but also reduce costs and improve profitability and cashflow.
To find out more register for our upcoming FREE 2-hour webinar here.
3 Strategies to Future-Proof Your Business
Australia is facing tough economic times. Anecdotally, I’ve had clients and business colleagues talk about how slow business is, how people just aren’t buying and how hard it is to win contracts. The competition for jobs is fierce and households are struggling to make ends meet.
For medium-sized businesses in the supply chain of large corporations, here are my top three strategies to future-proof your business:
Undertake rigorous budgeting and cashflow forecasting. Take these forecasts out for at least three years based on your best estimates of today. Then stress test them from all angles. Undertake what-if analysis to see the impact changes in revenue would have to profit and cashflow. Consider the effects of implementing efficiencies by looking at every aspect of business through an external lens of how you could do it better, more efficiently, with less cost or time involved.
Another way of considering this is to start with a blank sheet of paper and work out what you would do if you started all over again now. What would you do differently, what would you change in all aspects of the business? Then with that information, update your forecasts implementing any of these changes in an appropriate time frame.
Make sure you have plenty of working capital and are up-to-date with your superannuation and taxation obligations. In the case of the latter the ATO has a strong commitment to chasing up outstanding debts and is not hesitating to put companies into liquidation to stop the continued increasing debt owed to the government.
In terms of working capital, this does depend on the industry. A general rule of thumb is at least 6 months of costs held in cash or cash equivalents at all times. Agriculture needs a few years of costs in working capital as too often there are year on year either poor yields and/or poor prices due to factors often outside the control of the farmers.
I’ve recently been involved in a possible business acquisition where the vendor has reduced revenue, hasn’t reduced the staff levels whilst tendering for new contracts which may or may not come to fruition. However, the business didn’t have any working capital, so it is slowly getting further and further behind on payments to creditors, contractors, superannuation, ATO obligations and even wages to a few staff members. If this business had put aside money when it was doing well to have a cash balance to cover for the tough times it would be in better shape than it is today.
Implement ESG and carbon reporting into the business. Supply chain contracts require ESG reporting and even if your customer has not yet asked for the data, they soon will as mandated reporting comes into effect for large corporations on 1 January 2025.
With the long-term goal of carbon net zero emissions, every large corporation will be seeking to find suppliers who can provide carbon net zero figures to them. There are a number of ways of obtaining carbon net zero, but the first step is to know what the starting point is by preparing a carbon baseline report. Then armed with that information, work on a roadmap to reduce the emissions so that your business is attractive to your customer and they will continue with your contracts or it will help you to get new contracts as you get ahead of the competition for the contracts.
The future is bright for those companies working towards carbon net zero. Is your business going to be one of the companies of the future?
Want to learn more about how to get started on ESG reporting?
Join me on my free webinar to find out how.
Why Environmental Best Practices In Business Create Positive Cash Flow
Whether you believe in global warming, climate change and depletion of the ozone layer or not, the fact is that utilising environmental best practices is good for business and you’re already helping but you don’t realise it.
Consider this. You leave the office at the end of the day, the lights and air conditioning are left on. Or you make sure that the last person to leave the office, turns off all the lights and the air conditioning too. Which option would you choose? You’d choose the option to turn off the lights and air conditioning, wouldn’t you? Why? Because it will save on your electricity bill, that is, it will reduce your costs, increase profits and improve your cash flow. At the same time, it will improve your carbon footprint. But I get it. The primary reason for flipping those switches off at the end of the day is to save money. You’re not really thinking about the environmental impact.
Or consider this. You have the option to use vans to deliver your products or you have the option to use bicycle couriers to deliver your products. Now, let’s assume that there’s no significant difference in cost per delivery between the two options. But the van drivers don’t like delivering to the CBD and nearby suburbs as there’s no parking and they have to walk long distances to get to the delivery destinations. Bikes on the other hand can ride up to each address, park their bike and walk straight in. What choice do you make? I know one company that chose bike couriers. Given the assumption that the costs were the same, there would be no financial gain in using the bike couriers. However, relationships were improved with no more whinging and whining and refusal to take deliveries from the van drivers. As an added bonus, there’s a positive environmental impact.
I challenge you to think about what you’re doing in your business where as a by-product of the action, you are helping the environment.
But you can’t say precisely how much impact you’ve made unless you undertake scientifically-based calculations of your carbon emissions.
Want to learn more about how to get started?
Join me on my free webinar to find out how.
We are proud to advise that this article was written by the team and not produced by AI.
Why Bother With Carbon Reporting?
Have you ever felt overwhelmed with the idea of implementing carbon reporting in your business?
For too long we’ve been told it's extremely costly and time consuming.
I have found that businesses that implement carbon reporting actually save costs and create more profit.
For the past 10 years I’ve been working with business owners implementing carbon reporting, carbon reduction strategies which reduce costs and increase profits.
Today more than ever we need to be implementing carbon reporting not only to achieve the global goal of carbon net zero by 2050, but to be better business citizens by doing what’s right and at the same time making more profit.
Now is the time that we must start to reduce carbon emissions in order to make an impact on the environment and to appeal to environmentally conscious consumers and ensure long term supply contracts.
Right now I’d like you to join me for a FREE webinar where I will provide you with the framework to work towards carbon net zero emissions and keeping winning contracts.
Implementing Sustainable Development Goals Into Your Business
In 2015 the United Nations announced the 17 Sustainable Development Goals (SDGs) as a “shared blueprint for peace and prosperity for people and the planet, now and into the future”. Behind each goal is a detailed analysis and series of targets.
Have you ever felt that you want to do better for your community and the planet? Have you felt you want to help in some way, small as it may be, but perhaps haven’t known where to start?
I have found that as business owners, we can each do our part to work towards those goals. As individuals we identify closely to a few goals that resonate specifically with each of us.
I spent my teenage years in Canada, living on the outskirts of town just a few minutes bike ride from the wheat fields. We would get the first snowfall in the last two weeks of October, then more and more snow. Snowdrifts created by the winds and snow piled up meters high along the city streets where the snow plows had been.
The snow lasted through to April/May, 6 or 7 months of winter. Crisp cold days with blue sky and snow sparkling on the ground. As a teenager, it was heaven. But admittedly when it started to warm up and the snow started to melt, I was anxious for the weather to be warm enough to get my bike out and ride out to the fields again.
Now, though, a white Christmas is almost unheard of. If any snow falls between October and January, it is likely to last just a few days before it has melted. If you want snow, go in February.
Less snow, means less melted snow, which means less water to soak into the prairie soil. The impact on the ecosystem is significant with less water replaced into the water table every year.
For me SDG#13 is my first priority. As a lifelong learner, SDG#4 is another priority for me, too.
But as Dr Ibrahim Kshanh shows in his infographic below, we have the opportunity to do a little bit for each goal in our businesses.
With so many pressures on the planet, every one of these 17 goals are key to provide for the next generations to come and give them the best opportunity for the longterm.
With climate action and quality education close to my heart, check out the Carbon Readiness Assessment Quiz to see how your business rates.
We are proud to advise that this article was written by the team and not produced by AI.
Sustainability Is Both Environmental And Financial
The Cambridge Dictionary defines sustainability as “the quality of being able to continue over a period of time”. When applied to business, sustainability means the ability for a business to continue making profit over the long term.
But I believe that sustainability in business encompasses not only the financial capacity to continue over a period time but also how we consider our business impact on the environment over a period of time.
Both financial and environmental considerations combined will ensure the long term sustainability of every business. Financial sustainability is based on the demand for products and services, the quality of delivery and customer satisfaction that leads to sales and ultimately to profit and good cashflow.
Like the environment itself, every business is a mini ecosystem where every part of business is interconnected. Change one thing and it has an impact on the rest of the business.
The younger generations are more concerned than ever about the environment, global warming and climate change and they are making their feelings known by the way they spend their money. People will pay more money for a product that has been produced sustainably with a lower impact on the environment rather than buy the cheaper product that hasn’t considered the environment, uses child labour and so on.
Big brands are getting caught out “greenwashing”. This is where they make claims about the wonderful work they are doing for the environment but they cannot back up their claims with scientific data. As consumers, we take offence to that and switch our buying power to alternatives where the claims are legitimate.
Whilst supply chain contracts with large corporations have and will be enforcing their requirements for carbon emissions data from their suppliers as they work towards their mandated reporting and carbon net zero, the impact of those requirements will be felt at the consumer level.
Some businesses and some industries are well on the way to reporting their carbon emissions and those with the data to use in their marketing will gain the early competitive advantage. Not only that, but they will be ahead of the curve in the quantum of reductions as they start changing business processes earlier than those who choose to wait before starting.
What is interesting is that most businesses find they increase their profits once they start implementing changes that are environmentally responsible.
What’s your plan for the sustainability of your business? Don’t let the opportunity to gain competitive advantage and make more profit pass you by. Take the Carbon Readiness Assessment to see how ready you are to get started on this important change to your business.
We are proud to advise that this article was written by the team and not produced by AI.
The Unexpected Benefits of Carbon Reporting
Have you considered the value of calculating your carbon footprint? There are several reasons to undertake the calculations but there are benefits to consider too.
Reasons for preparing a carbon emissions report include:
You are required to provide the figures under your supply chain contract
You are seeking to sign a supply chain contract
You want to reduce costs and improve your profit
You are looking for a competitive advantage
You are environmentally responsible and want to have scientific data to support your words
To increase sales you know you need to appeal to environmentally-conscious consumers
There are the obvious benefits of more income, less costs, extended supply chain contracts and so on and then there are the surprising benefits that you won’t find until you’ve seen your numbers.
For example, Sarah, the founder of Little Flowers, an online florist in Sydney had a vision when she started her business over 10 years ago to have the bunches of flowers delivered by bike couriers. This vision became a reality after 6 months of trading when parking in Sydney CBD became extremely difficult and meant long walks to deliver the flowers.
On one particular day, she met a bike courier in an elevator when both of them were delivering to the same office, Sarah with her bunch of flowers, and the bike courier with an envelope of documents. They got talking and not long after he became her first bike courier.
Ten years later with 100,000 bunches of flowers delivered by bikes, she wondered what the environmental impact she’d made by switching from vehicle to bike deliveries. She didn’t know where to start or who to talk to, let alone what information would be required to undertake the calculations. And that’s where we stepped in and worked with her and calculated the carbon emission savings for her.
When Sarah received the report, she was amazed. The figures were so much more than she had expected, although she had no real idea what the numbers would be. She shared the results with her bike couriers who were just as excited about how much they had done for the environment. Everyone was happy.
Later that week as Sarah sat in her office and again looked at the report, she thought about her vision for the business all those years ago and she realised that she had achieved her vision. She felt grateful for that day she met the courier in the elevator and felt in her heart that all the hard work had been worth it. She had made a difference.
What unexpected benefit could you get from knowing your carbon emission numbers?
We are proud to advise that this article was written by the team and not produced by AI.
How Reducing Carbon Emissions Leads to Cost Savings and More Profit
You may believe it is counterintuitive to think that reducing carbon emissions will increase profits, but that is not true of all emission-reducing initiatives. When you think of reducing carbon emissions we think of the large capital costs. Setting up solar and wind renewable energy solutions requires significant capital investment up-front. Equally replacing high consumption fossil fuel vehicles and machinery requires capital investment.
Even with solar or wind farms, or replacing vehicles and machinery there will be cost savings and more profit. In those cases, it will take a few years to see the cost savings. For example, solar panels are expected to last 20-30 years, but the average household takes 4-6 years to recover their initial investment from the savings in their electricity bills. As a result, a household will have cost savings starting after 5-7 years and lasting for the rest of the life of the solar panels, another 15-25 years.
There are other ways to reduce emissions that will have an immediate impact without large capital investment up-front. For example:
Consider the impact of holding more meetings via video conferencing rather than face-to-face. Whilst this was implemented during Covid and continues to be especially useful for widely dispersed teams, there are carbon emission savings to be had when the team all live in the same city too.
This does need to be counter-balanced by the value of face-to-face meetings. I was involved with a company that had a widely dispersed team. Every month the senior leadership team was flown into Sydney from around Australia for a one-day meeting. Often this meeting only went for half the day. Whilst some of those meetings were exceptionally valuable for having the team together, many of them were not. Not only was there the carbon emissions impact of the travel and accommodation costs but there was also the time lost whilst the team was travelling.
I think it’s worth thinking about whether there is enough value to be had in the face-to-face meetings to incur the carbon emissions involved and whether some of those meetings could be changed to video conferences.
Talk to your team about how they travel to work. Could they change from driving a car to using public transport, or walking/riding a bicycle? If every team member changed their commute even just one day a week, that would make an impact on your carbon footprint.
Whilst there is a push to get staff back into offices full-time or at least multiple days each week, consider the carbon emissions cost, the cost to the employee of the commute and their lost time in the commute as factors in those decisions.
Ask your existing electricity supplier for their carbon emissions information if it isn’t on your bills. Then research alternative electricity suppliers to see if they use more renewable energy sources and thus have lower carbon emissions.
When considering this option, the cost per kWh will need to be factored into the decision.
When you think about your carbon emissions and how you could start to make small changes to improve your carbon footprint, use the above ideas as a starting point and brainstorm what else you could do in your business.
What is helpful is to undertake a carbon baseline report to give you the data to understand what your carbon emissions are. Armed with that information, you can develop your strategies for carbon reduction and track your progress. Are you ready to start reporting your carbon footprint?
The Stepping Stones Toward Carbon Net Zero
With the global goal of Carbon Net Zero by 2050, you could think there’s plenty of time. There is no need to rush into carbon reporting, change business processes, invest in renewable energy solutions, etc. Carbon Net Zero is part of the wider ESG requirements and is an essential part of sustainability in business.
But there are also targets set for 2030 and that’s a mere 6 years away. Like any other change, the first question is where do I start? Then taking the first step is the hardest but having goals to work towards makes it easier.
The 4 Stepping Stones Toward Carbon Net Zero
Determine how ready your business is for carbon reporting.
Undertake a carbon baseline report. This will give you your starting point and, if you like, draw a line in the sand. Many businesses have already been implementing sustainability practices. It’s a shame that the reporting wasn’t done before they made the changes so the impact could be identified. But it doesn’t matter. What does matter, is working out what your carbon footprint is now.
Work on a plan towards carbon neutrality. This is where you use a combination of changes to business practices, use more renewable energy, and look for efficiencies in processes that will reduce fuel and energy consumption combined with buying carbon offsets. A typical carbon offset project is buying trees, but there are other options, like buying carbon credits. The goal is that the carbon offsets match your carbon emissions so that you have a neutral carbon footprint.
The long-term goal is carbon net zero. This is when your carbon footprint has been reduced by 90% and the carbon offsets account for no more than 10% of your carbon footprint. This is where we all need to be by 2050.
Changing business processes may mean investing large sums of money to buy new equipment, machinery, and vehicles. These changes need to be factored into a long-term strategy based on the cash flow requirements of the business. For example, if you’re a trucking company, you may replace one truck every two years with a new truck that has energy savings systems, runs on renewable energy, etc. Or, if you’re in manufacturing, you may need to work towards replacing equipment with new energy-efficient equipment in five years. Every business will have a different strategy to work on to ensure the sustainability of their business.
Are you ready to start working towards Carbon Net Zero? Take the Carbon Readiness Assessment here and find out.
We are proud to advise that this article was written by the team and not produced by AI.
How New Technology Can Help Reduce Transport Costs
Technology in the transport industry has increased dramatically in recent years. Technology comes in many forms but typically there is a capital cost up-front to implement it.
A recent article from Fleet Maintenance refers to new technologies that can be implemented to reduce fuel costs. For example improving aerodynamics of the vehicles, low rolling resistance tyres, speed limiters and optimising engine parameters for fuel efficiency. Read the article in full here.
I was recently talking to a trucker from the US who mentioned technology in the trucks that helps the driver use the most efficient route, provides recommendations on the best time of day to travel to avoid congestion to ensure their trip is completed in the shortest time possible with the least delays in traffic to minimise fuel consumption.
There are three areas to consider when reducing transport costs:
Understanding what technology is available and how it will help to reduce costs.
Working through the financial analysis to create a business case for each change in technology. By doing this you will know exactly how much money you need to spend up-front and how long it will take to recoup that cost in cost-savings before increasing profits.
Calculating the carbon emissions of the existing use and calculating the impact of new technologies. This will clearly define the reduction in carbon footprint.
Historically, business decisions have been made largely based on financial considerations. Implementing change was predicated on reducing costs and increasing profits. However, with the requirements for carbon emissions reporting and reduction and sustainability high on the agenda, decisions now need to be made taking into account the carbon footprint data.
Reducing transport costs by implementing new technology will ensure the long-term sustainability of the business both financially and environmentally.
We are proud to advise that this article was written by the team and not produced by AI.
Transport Changes Reduce Carbon Emissions
Even if you don’t have any issue with your current transport solutions, consider thinking about them differently.
What if you could use a transport company that uses electric vehicles, or a transport company that has invested in alternative energy technologies to reduce carbon emissions?
What if you could use bicycle couriers for local deliveries instead of a gas-guzzling, carbon dioxide-producing vehicle?
Eleven years ago an entrepreneur dreamed of delivering beautiful bunches of flowers by bicycle couriers. A romantic notion? Perhaps. Particularly when the Little Flowers business was established in the Inner West of Sydney.
When the business started and as the reality of parking a van full of bunches of flowers in Sydney CBD and delivering on foot became a logistical nightmare, the dream took hold. A chance meeting in a lift with a bike courier delivering documents paved the way for implementing bike courier deliveries.
A new delivery system was established and a fleet of bike couriers delivering flowers has grown. The bikes are loaded with flowers in a tray at the front with the fragrant smell and pretty flowers bringing smiles to people as they do their deliveries.
When Little Flowers achieved a milestone of 100,000 bunches of flowers delivered by bike couriers, they asked us to undertake an analysis to determine what the impact had been.
We discussed the details of the deliveries and obtained data from Little Flowers to assess their carbon emission savings. Our analysis showed they reduced their carbon footprint by approximately 36.7 tonnes of carbon dioxide equivalents over the past ten years.
Little Flowers didn’t want a full ESG report detailing every detail of their business. What they were interested to know was the impact of that one initiative.
You might think a small change doesn’t make a big difference, but it can be the small changes that have the biggest impact.
Next time you’re looking for a transport solution think about how you could change what you’re doing to reduce your carbon footprint.
We are seeing more businesses promote their sustainability work which is great news. What we love more than that is analysing the data to show how much they have reduced their carbon footprint. With the overall aim of reducing carbon emissions to zero over the coming years, knowing your carbon numbers and complying with ESG reporting requirements will be a key element of business success.
We are proud to advise that this article was written by the team and not produced by AI.
Transport: The Second Largest Sector for Greenhouse Gas Emissions
The transport sector ranks second highest in terms of greenhouse gas emissions in Australia according to the 2023 Annual Progress Advice Report issued by the Climate Change Authority. The energy sector is by far the largest contributor at 54%, whilst the transport sector comes in at 19%.
Australian homeowners have taken up the mantle with solar panel installations, we have solar and wind farms sprouting up around the country and ongoing debate about the alternatives for coal-powered electricity generation. The energy sector is well and truly in the news and under scrutiny to reduce emissions.
But what about transport? At an individual level, we’ve seen the take-up of electric vehicles (EVs) and more recently a move toward hybrid vehicles instead. Like solar panels on home roofs, EV or hybrid vehicle purchases indicate consumers are embracing the need to change the way we look after the planet to reduce emissions to improve the environment.
At an industry level, transport companies are grappling with the capital cost associated with reducing their emissions, whether by converting to alternative energy, buying replacement vehicles with lower emissions or investing in systems that improve the efficiency of transport routes.
Most trucking businesses are either owner-operated or have less than 19 employees. There is no requirement for these companies to report their carbon emissions and worry about sustainability based on the current legislation. However, the larger companies that are required to report will ask their suppliers for their carbon emissions data so they can report more accurately.
With the goal of reducing carbon emissions to zero by 2050, every single business (and individual) needs to play their part. Every company will need to be working toward that same goal. Failure to do so may mean losing long-term contracts. We believe those contracts will be based not only on price and reliability but also on carbon emissions data.
The sooner every business in the transportation industry identifies their carbon footprint and devise a plan to reduce carbon emissions, the better the industry will be. Each business will benefit also from improved efficiencies, reduced costs in the long run whilst ensuring long-term sustainability.
We are proud to advise that this article was written by the team and not produced by AI.
Technology for Carbon Reporting in ESG
I’ll confess, I’m a tech nerd. I love technology. I particularly love technology that makes repetitive and mundane tasks quicker and easier. It’s even better when it automatically does the hard work. Eliminating spreadsheets and printing reports ticks the sustainability box too.
As a result, I’m perpetually on the lookout for new tech that will help my clients work easier. So, I’m super excited with the plethora of available carbon reporting systems with new ones popping up almost daily.
Whilst the choice is marvellous, what’s not so great is working out which system is best suited to any particular business.
There are systems which focus on:
Specific industries
Calculations for specific emissions
Providing educational resources
Using AI to completely automate the processing
Allowing specific efficiency factors to be used based on supplier data
Providing really cool reporting
Wholistic ESG reporting
Certification within the system
Suggestions on how to choose a carbon reporting solution.
Check with your industry association. There are a number that have developed solutions specifically for their members.
Ensure the solution integrates seamlessly with your accounting system.
Find out how long the system has been in operation and ask for a few people who are using it to talk to and get their feedback on how the system has been working for them.
Look at the pricing. Keep in mind the saying “you get what you pay for”. The most expensive solution doesn’t necessarily mean it’s the best, but it may mean you’re getting more included in the system, saving you money elsewhere.
Seek expert advice.
Run a trial to determine whether the system is easy to work with.
Whatever solution you ultimately decide upon it will provide the data you need to report on ESG, carbon reporting and your sustainability initiatives. Over time you may consider changing if reporting requirements change.
We are proud to advise that this article was written by the team and not produced by AI.
Is Australia Lagging with ESG and Carbon Reporting?
I’ve been interested to see news that indicates a larger proportion of businesses in the UK are already doing ESG and carbon reporting compared to Australia. As might be expected, I believe this is due to reporting requirements already in place in the UK and EU indicating that Australia is lagging in this area.
Companies in Australia that export or provide products and services to International brands are already being asked to report on their sustainability initiatives with the expectation of full ESG reporting for the 2023-2024 financial year. One client recently was visited by an advisor to their International clients to check out their business premises and to discuss sustainability. The client was advised to undertake ESG reporting immediately to maintain their contracts.
Economically it feels like Australia is doing it tough, farmers are struggling to make ends meet with pricing for their products being squeezed below their cost of production, other businesses are dealing with higher interest rates, wage increases, another 0.5% superannuation guarantee increase from 1 July and the generally higher cost of everything.
Adding ESG reporting to provide carbon footprint data and sustainability information is another burden being imposed on those businesses. What has not been made clear to businesses is that many sustainability initiatives save costs making the business more profitable.
Some years ago at one of the farms I worked with, the staff would identify that they needed to go into town for a screw, or a bolt or some small piece of hardware. The drive to town was 30 minutes. Whilst their intent was both to get off an hours’ work and also buy a coffee and lunch, more than one staff member would do the trip every day. By building up a supply of hardware in the shed, and insisting that the staff could not just go into town on a whim, not only was the team more productive, but they saved a significant amount of fuel and carbon emissions.
What could you do differently with your business processes to save fuel?
We are proud to advise that this article was written by the team and not produced by AI.
Sustainability Reporting: The Importance of Calculating Your Savings
I love seeing how businesses have changed how they operate to embrace sustainability. In recent weeks, I’ve seen several initiatives that business owners have implemented as a matter of good practice and to do the right thing for the environment.
Within these initiatives are great ideas of what other businesses could do too, for example:
Using bike couriers instead of vehicle couriers to reduce vehicle emissions
Eco-friendly printers to reduce electricity consumption
Recycling materials to reduce landfill
Battery-powered forklifts to reduce fuel consumption
Skylights to provide natural light reducing reliance on electricity
Mulching to keep moisture in the soil to reduce irrigation requirements which results in less electricity or fuel consumption
The list goes on. Great work, no question.
Interestingly none of these businesses have undertaken scientific data analysis to determine how much carbon they are saving.
Carbon reporting to comply with the International Standards (GHG Protocol) that provide a framework for calculating carbon emissions provides the carbon footprint of the total business. Over the next few years as the Australian Government mandates reporting disclosures, the requirements will filter down the supply chains of large corporations to medium-sized companies.
Whilst not required by legislation, undertaking a comparative analysis of the sustainability projects provides data on carbon footprint savings for the sustainability projects specifically. This information will be useful when mandated reporting is required.
Think how much more belief would be placed on the sustainability projects if the businesses provided that data as part of their sustainability information now. Businesses already on the sustainability path can further differentiate themselves from their competitors by calculating and showing their carbon emissions savings data.
We are proud to advise that this article was written by the team and not produced by AI.
Announcing new partnership
I am super excited to announce that Carbon Reporting Pty Ltd has partnered with EcoForce Global to support farmers with their carbon reporting. EcoForce Global is on a mission to “plant enough trees to sequester 30% of the world's annual carbon output and create a living legacy for all.“
A mighty mission you might say, but Charles and Tracy Alder, the founders of EcoForce Global created the hugely successful fundraising campaign “Buy a Bale” for Rural Aid during the drought. So, if anyone is going to be successful in a mission of this magnitude, I can’t think of anyone better than this powerhouse couple.
Their premise is simple. Buy trees to plant on farmers’ properties worldwide and help farmers with their regenerative, sustainable farming practices. It is something that every one of us can help with.
If you’re interested in finding out more about EcoForce Global, check out the link here: https://www.ecoforceglobal.com/?u=corp. Iif this is something you’d like to be a part of, let me know and I’ll give you more information.
How to Choose Your Carbon Footprint Advisor
There are two parts to carbon footprint reporting. The first is the calculation of the carbon emissions for the business. The second is identifying areas for improvement and developing a roadmap to reduce carbon emissions to net zero.
Who is best to assist in this area?
Accountants are seen to be the starting point as the calculations behind carbon reports are principally based on accounting records. The challenge for accountants is that whilst upskilling to prepare the reports is fairly straightforward, knowledge of carbon emissions, business operations and developing business cases will require significant training that many accountants just won’t have the time, or even the inclination, to do.
If you use your accountant to ensure you’re getting the best tax result, you want them to be an expert in tax legislation.
If you use your accountant to provide business advice, budgeting, forecasting and management reporting, you want them to be an expert in business advisory services.
If you use your accountant to provide carbon emissions reporting and advice, you want them to be an expert in carbon emissions reductions, sustainability and environmental compliance. Add to that the requirement for social and governance reporting to round out the ESG requirements and it’s a completely different skillset and knowledge that accountants don’t have.
I have tried in the past to combine two key skills and it just doesn’t work. Each individual can only be an expert in one area to do it well.
Mid-tier and the Big 4 accounting firms are developing internal specialist teams to provide carbon reporting and ESG advisory services and will charge accordingly.
The alternative are the specialist carbon reporting and ESG advisory companies where the whole and sole focus is in this area. They have a background working in companies where carbon and ESG reporting have been implemented as best practice, required by law or due to stakeholder requirements. These specialists know how business operations impact the environment and have seen how changes in business practices have reduced carbon emissions.
With upcoming legislation requiring large corporations to report on their carbon emissions, they will require their suppliers to provide their carbon emissions data. This will create a waterfall effect as suppliers require information from their suppliers and down the supply chain the requirements will flow, requiring medium-sized companies to undertake this reporting.
Now is a good time to take stock of your current carbon footprint, undertake a carbon baseline report and start working to reduce your carbon emissions.
We are proud to advise that this article was written by the team and not produced by AI.