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Why measure carbon emissions?

Why measure carbon emissions?


Measuring carbon emissions is a smart move for businesses for a ton of reasons.
For one, it helps you figure out how much your company is contributing to climate change and find ways to reduce your environmental impact.

Not only is this good for the planet, it can also make your business look more attractive to customers who care about sustainability. Plus, cutting down on carbon emissions can save your business money by making you more energy efficient.

On top of all that, some countries have laws that require companies to report on their carbon emissions and try to reduce them.

Basically, measuring carbon emissions is a no-brainer for any business that wants to be more environmentally friendly, save some cash, and maybe even stay on the right side of the law.

Investors increasingly request ESG and GHG disclosures πŸ’Έ

There are several reasons why investors may care about the emissions of a company they invest in. These concerns are the reason that investors are beginning to request Environmental, Social, and Governance (ESG) disclosures, which include Greenhouse Gas (GHG) footprint data.
First, investors may be concerned about the potential financial risks associated with climate change. For example, if a company has high carbon emissions, it may be at risk of regulatory fines or other costs related to carbon pricing schemes or emission reduction targets. In addition, climate change could also lead to physical risks such as the destruction of assets due to extreme weather events, which could impact the company's financial performance. By measuring and reducing their carbon emissions, a company can mitigate these risks and potentially improve its financial stability.

Second, investors may also be motivated by ethical or environmental considerations. Many investors are increasingly considering environmental, social, and governance (ESG) factors when making investment decisions. By demonstrating their commitment to sustainability and reducing their carbon emissions, a company can potentially attract these types of investors and improve its reputation.

Finally, investors may also be influenced by the growing awareness and concern about climate change among the general public. As consumers become more aware of the environmental impacts of the products and services they buy, they may be more likely to choose companies with lower carbon emissions. This could lead to increased demand for low-carbon products and services, and in turn, improve the financial performance of companies that are able to meet this demand.

Customers care about the products and services they buy 🎁

Both B2B and B2C businesses can benefit from communicating their sustainability efforts to their customers. Here are a few reasons why:
Customer demand
Many consumers, particularly younger generations, are increasingly interested in supporting businesses that prioritize sustainability. By communicating your sustainability efforts, you can differentiate your business from competitors and potentially attract new customers.

Improved reputation
Demonstrating your commitment to sustainability can also improve your company's reputation, which can lead to increased customer loyalty and potentially drive more sales.

Cost savings
Implementing sustainability measures can often lead to cost savings, such as reduced energy costs. By communicating these efforts to your customers, you can demonstrate the value you are providing to them and potentially differentiate your business from competitors.

Legal and regulatory requirements
In some cases, businesses may be required to disclose information about their environmental impacts or sustainability efforts to customers, such as through mandatory sustainability reporting or labeling schemes.

Overall, communicating your sustainability efforts can help to build trust with customers and differentiate your business in a crowded market.

People want to work for a company that has a purpose, and can prove it πŸ‘¬

Measuring your company's carbon emissions and engaging your employees in sustainability efforts can be a powerful way to drive purpose and meaning within your organization. Here are a few reasons why:
Demonstrating your values
By taking action to reduce your carbon footprint and engage your employees in sustainability efforts, you can show your company's commitment to environmental responsibility and social impact. This can help to foster a sense of purpose and pride among your employees, and can also help to attract and retain top talent who value sustainability.

Improving engagement and productivity
Engaging your employees in sustainability efforts can also lead to increased engagement and productivity. Research has shown that employees who feel that their work has a positive impact are more likely to be motivated and productive. By providing opportunities for your employees to get involved in sustainability initiatives, you can create a sense of purpose and meaning that can drive better business outcomes.

Fostering innovation
Measuring your carbon emissions and engaging your employees in sustainability efforts can also encourage innovation. By challenging your employees to find new ways to reduce your company's environmental impact, you can foster a culture of continuous improvement and drive innovation.

Overall, measuring your carbon emissions and engaging your employees in sustainability efforts can be a powerful way to drive purpose, improve engagement and productivity, and foster innovation within your organization.

Governments are increasingly requiring emissions reporting from the private sector πŸ‘¨β€βš–οΈ

Government regulation can increase the need for carbon emissions calculation and disclosure in several ways.
In many countries around the world (including the US and EU) there are already mandatory climate disclosures for large companies, and disclosure requirements for all large and public businesses are likely to come within the next few years. Larger organizations will require emissions and other ESG data from their supply chains in order to comply with these requirements

These are a few of the main ways government regulation can increase the need for GHG accounting and disclosure:

Emission reduction targets
Governments may also set emission reduction targets as part of their efforts to combat climate change. In order to track progress towards these targets, businesses need to measure and report on their emissions.

Sustainability reporting
Governments may also require businesses to disclose information about their environmental impacts and sustainability efforts through mandatory sustainability reporting or labeling schemes. This may include information about carbon emissions and efforts to reduce them.

Carbon pricing schemes
Many governments around the world have implemented carbon pricing schemes, such as cap-and-trade systems or carbon taxes, to incentivize businesses to reduce their carbon emissions. In order to participate in these schemes, businesses often need to measure and report on their emissions to ensure compliance.

Overall, government regulation can increase the need for carbon emissions calculation and disclosure by creating a legal requirement for businesses to measure and report on their emissions in order to comply with carbon pricing schemes, emission reduction targets, or sustainability reporting requirements.


Want to know more?Β Check out our Comprehensive GHG Accounting Guide for SMEs.

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