In less than two years time if your law firm doesn’t have a credible environmental policy then you won’t stand an earthly chance of winning any legal business from public sector bodies or UK plc’s. telling staff to turn off their computers when they leave for the night just doesn’t cut it any longer. Gordon Archer of carbon accountable explains how vital it is for your own business future that you start thinking green today.

Greenwash – you can’t escape it. We have all been deluged with pro environment messages. Everywhere you look everyone wants to tell us about their green credentials. My favourite is the well known brand advertising fabric softener. Apparently we can take thousands of lorry trips off the road by using their concentrate brand as opposed to a regular non concentrate. Presumably if we stopped using the fabric softener altogether we would prevent even more lorry loads and increase our green credentials even further.
The delusions of ad agencies aside, there is a serious message in amongst the Greenwash, and for businesses there are significant changes in the regulatory and legal landscape which will require serious consideration.
Let’s deal with the message first – it would be a mistake to think that consumer scepticism translates to a lack of interest in environmental issues and global warming in particular. Yes it’s true that those who don’t buy the argument in the first place can use the ridiculous claims of the Greenwash peddlers as an excuse for inaction. But the majority opinion in Scotland and the UK does believe the argument on global warming, and is able to discern the bogus from the credible.
Businesses which believe that they do not need to address the concerns of their customers in this regard, risk alienating them and ultimately losing business to their competitors which do. Those businesses which take a pragmatic view based on what is achievable and credible will prosper.
This is especially true for companies such as solicitors who provide services directly to the public and to other businesses. Chances are if you contract regularly to PLCs or public bodies you will have noticed the environment or sustainability question rising up in importance in the tender process. 12 months ago it may have been a simple one line question now it’s likely to be a bit more detailed and soon companies will be asked for copies of their environmental policy and be scored on its quality and veracity.
Today having a credible environmental policy, being aware of your carbon footprint and having a carbon management plan to reduce it, may just be issues on a wish list – tomorrow they will be an essential part of doing business.
As governments at the Scottish, UK, EU and the world level look for market and regulatory answers to the questions posed by climate change, the effects will be felt by everyone. Let’s look at two examples currently being rolled out in the UK: the Carbon Reduction Commitment and the Energy Performance of Buildings Directive.
Taken together these measures are intended to deliver emissions reductions totalling 0.5 million tonnes of carbon per year by 2015, rising to 1.2 million tonnes of carbon per year by 2020. To put those numbers in context average domestic consumption of electricity amounts to the equivalent of 1-2 tonnes of carbon per annum.
Implemented by January 2009, the Energy Performance of Buildings Directive is an EU directive which will require Energy Performance Certificates (EPCs), when buildings are constructed, sold or rented out. The EPC will show an energy “asset rating” for each building, which is a numerical indicator of the amount of energy estimated to meet the different needs associated with a standardised use of the building. Asset ratings are calculated, taking into account the energy performance of the building’s fabric and its services (i.e. heating, cooling, hot water, ventilation and lighting).
With a target date for implementation of 2010 the Carbon Reduction Commitment (CRC) is a mandatory auction based cap and trade scheme in which participants will be required to purchase sufficient allowances to cover their annual energy use CO2 emissions. The CRC is targeted to include large retail organisations, banks, large offices, universities, large hospitals, local authorities and central government departments. Large organisations are defined as those with annual electricity consumption in excess of 6,000 megawatt-hours (MWh), or at current energy prices, annual electricity bills above £500,000.
They will need to monitor their emissions throughout the compliance year and, at the end of that year, surrender allowances corresponding to their annual energy use emissions to the Scheme Administrator.
Put simply, for those public sector organisations and companies coming under the CRC, from 2010, let your carbon emissions rise too far and face a financial penalty. Reduce that carbon footprint and collect a bonus. Furthermore it is difficult to imagine that the scheme’s influence will stop with those directly affected. Any scheme which has 5,000 to 6,000 major companies and public sector organisations involved in it will have a knock-on effect on its competitors and associates, as well as a direct effect on those who supply it with goods and services.
Taken together these measures will transform the business view of carbon management. It is not a stretch to envisage the energy rating of a building taking its place amongst the usual criteria of location, size and price in determining its commercial value. We can expect public bodies and PLCs to start specifying minimum standards of energy performance as part of their own carbon management policy straight away.
It can be taken as read that if M&S for example is monitoring its carbon emissions as part of the CRC – they will not want to move into carbon inefficient premises and they may even be looking to move out of current premises if those premises detrimentally affect their carbon bottom line.
In a similar vein if Birmingham City Council for example is being obligated to monitor and comply with a carbon reduction programme, it seems a safe bet that it will expect the burden of that effort to be shared with its supply chain. That can be expected immediately with any private body it shares or out sources services to, and pretty soon after, for everyone else.
Carbon management is a fact of life for business. It is high on the public’s agenda and hardwired into the policy framework of government and opposition parties alike. It is here to stay and like any customer demand or government regulation it needs to be factored into business planning. Arguing against it is a bit like arguing against income or corporation tax - you will still have to pay when the due date comes around.
On the up side, it is impossible to reduce your carbon emissions without reducing costs. Lower emissions through electricity consumption, means less electricity used. Carbon efficient businesses have lower energy, fuel and waste costs. And in the same way that good advice is essential to deal with any business cost your business should ensure it’s getting the right advice on carbon management.
So if you don’t have a carbon management plan in place you need to get one. Not convinced? Just think about meeting customer demand, complying with regulations, becoming more competitive and lowering your overheads – that doesn’t seem like Greenwash - just good business sense.