Carbon accounting: The foundation of sustainability strategy

You can’t change what you haven’t measured.

That’s the central idea behind the practice of carbon accounting - the process by which an organization can understand and report on its own carbon emissions.

Energy consumption, data storage, packaging, supply chain efficiency - all of these contribute to a businesses carbon footprint. If you can’t measure the impact of these, it’s impossible to know where you need to make changes  and if any steps you’re taking are actually working. 

Carbon accounting helps organizations understand their overall performance and demonstrate their commitment to implementing sustainable efforts for both internal and external audiences and stakeholders. 

Bad for the environment, bad for business

‍Sustainability is no longer just a moral issue - it’s the responsible choice from a business point of view. 

The benefits, beyond doing the right thing, include:

• Cost savings
  With proper carbon reporting, you can immediately show both direct financial costs and untapped savings opportunities. 
• Improved brand reputation
  Consumers are more and more environmentally-conscious, and are willing to vote with their wallets. Improving the brand’s reputation by attracting environmentally conscious customers, which will ultimately contribute to the long-term viability of the business.
• Improved risk management
  By monitoring emissions data, businesses can identify potential risks related to climate change and take the right steps to mitigate them.

Additionally, accurate reporting helps businesses comply with regulatory requirements like European Sustainability Reporting Standards. Around the world, businesses are often required to report on their sustainability performance by law or as part of industry initiatives, so ensuring that reporting is accurate and effective is imperative in helping meet these requirements and demonstrate compliance.

But the practice has inherent difficulties that mean organizations aren’t as advanced in their capabilities as they could be.

What’s holding organizations back from proper sustainability reporting?

‍Businesses are facing three key challenges when it comes to carbon accounting measurement and sustainability reporting. 

1. Access to data
   First, they often only have access to limited, high level data which is holding them back from capturing all aspects of their carbon impact. Especially in large, complex organizations, data is often siloed which means a holistic view of a company’s carbon impact is difficult to understand.

2. Inadequate tooling
   Many organizations are attempting to conduct carbon accounting in spreadsheets. While versatile, spreadsheets are too slow, manual, and don’t scale with the organization. Businesses need highly granular, real-time analysis of the carbon impact of every single activity, product, person and so on. 

3. Other priorities
   Finally, business leaders are operating in volatile and uncertain times and are increasingly focusing more on the short term than the long term, which means carbon accounting and sustainability reporting are often deprioritized in favor of other initiatives. 

How we’re helping

Through Pigment’s carbon accounting pilot program, we invite organizations looking to understand the details of their carbon footprint to work with us to bring sustainability data into Pigment so that it can be measured and tracked. The program has already enabled companies such as Webhelp and Cheerz to better understand their carbon footprints.

For more details, click here.