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Measuring Your Business Carbon Footprint- The Compeitition is Doing It

Companies are measuring and reporting carbon footprint and climate change measures for risk management and competitive advantage

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October - 2006 -- About 75 percent of companies are actively measuring their “carbon footprint” – the range of carbon emissions from their operations, both direct and indirect, according to a report released today from The Conference Board. The report, based on a survey of 92 companies from various industries, looks at how companies are integrating greenhouse gas management into their overall business strategy.

More than 95 percent report that they see the prospect of a carbon-concerned future as creating both business risk and opportunity. One-half indicate they have a program in place to “actively reduce or offset greenhouse gas (GHG) emissions.” An additional 33 percent are developing such programs, while 15 percent have no plans to do so. Nearly all programs include reductions in energy use, while most (83 percent) are simultaneously focused on reducing GHGs. One-third are focused primarily on direct emissions – those resulting from fuel consumption or from materials used in their processes – while two-thirds include both direct and indirect emissions (primarily purchased electricity).

Fewer than 20 percent have attempted to measure their competitors’ carbon footprints, which may reflect the complexity and difficulty in doing so or indicate that the issue is not perceived as a major competitive challenge at this time.

Emissions Trading and the ‘Cost’ of Carbon

Only 15 percent of the companies now engage in voluntary emissions trading, but an additional 40 percent are considering it. Among those companies engaging in voluntary trading, motivations include: anticipation of potential regulation; to develop a track record for possible credit for prior emissions reductions; reputation benefits; to learn the process.

Greenhouse Gas Emission Offsets and Credits

Some organizations “sequester” carbon so that emissions released in one locale can be either consumed by growing vegetation or physically sequestered in geological formations. Nearly 44 percent of surveyed companies are either involved in sequestration projects or considering them.

Other approaches that companies are pursuing include the purchase of “green power” and renewable energy credits, including investment in “Clean Development Mechanism” projects in developing countries to create emissions credits (an approach created under the Kyoto Protocol).

Governance and Carbon

Companies were asked how they address greenhouse gas emissions management within their companies. Fifty-six percent assigned a responsible senior executive to coordinate company actions, while 44 percent have not done so. At the board level, the issue is on the agenda at over two-thirds of the companies

Source: ‘Carbon Footprint’ an Increasing Management Concern
Executive Action No. 213, The Conference Board

About The Conference Board
Non-partisan and not-for-profit, The Conference Board is one of the world’s leading business membership and research organizations. The Conference Board produces The Consumer Confidence Index and the Leading Economic Indicators for the U.S. and other major nations. These barometers can have a major impact on the financial markets. The Conference Board also produces a wide range of authoritative reports on corporate governance and ethics, human resources and diversity, executive compensation, outsourcing, profiting from a mature workforce, and corporate citizenship. Our conference and council programs bring together more than 12,000 senior executives each year to share insights and learn from each other. Visit The Conference Board’s website at

Edited by Carolyn Allen, owner/editor of California Green Solutions
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