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Why Your Small Business’s GHG Management is a Big Deal

GHG (greenhouse gas) management is important for businesses of all sizes.

Female scientist sitting in front of computer screens

June 9, 2020

GHG management matters

The catastrophic effects of climate change are not just a problem on the horizon. In many ways, the threat has already arrived. According to the World Health Organization, about 12.6 million deaths each year are caused by environmental factors like pollution, chemical exposure and ultraviolet radiation. About 41 million Americans live in 100-year flood zones, meaning that their property has a 25% chance of flooding in the course of a 30-year mortgage. Sea levels continue to rise, inching closer to millions of homes and businesses.   

These changes are caused by the earth’s rising temperature, which scientists attribute to greenhouse gases (GHG) like carbon dioxide. Human activities like burning fossil fuels for energy or clearing a forest to make room for housing and agriculture emit a great deal of GHGs, which then trap heat in the earth’s atmosphere and raise the planet’s temperature. To stave off further disaster, we must drastically reduce how much greenhouse gas is emitted into the atmosphere.

Thirty-five percent of all greenhouse gas emissions can be attributed to just 20 firms, all of them large fossil fuel companies, worldwide. That’s 480 billion tons of carbon dioxide equivalent since 1965. All 20 firms have pointed to their mitigation efforts, such as investing in greener technologies, in response to the negative publicity they earned as top-20 polluters. If these firms sufficiently reduce their own carbon footprints, the results will have a pronounced effect on overall emissions. But that doesn’t mean only the largest companies can make a difference.

The cumulative effect of small business carbon footprint

Small and medium-sized enterprises (also known as SMEs) can play a major part in the movement toward a cleaner, safer environment. Shrinking carbon footprints means altering nearly every facet of society, from energy use to waste management, from the products we buy to the way we conduct business. In the fight to save earth, every little bit counts. 

More than 99% of the 28.7 million companies in the United States are small businesses. Together, small businesses are a major force in the American economy. As you begin to track your company’s greenhouse gas emissions and make changes to reduce your carbon footprint, you help — even in a small way — the overall goal of reducing emissions worldwide. If the other corporations in your city, in your industry and in your sector do the same, your collective impact is magnified. 

Evolving values

Environmental and social responsibility are more important than ever to investors and consumers alike. The rise of socially responsible (SRI) or ESG (environmental, social and governance) investing demonstrates how capital coincides with ethics and values. In 2019, an Allianz survey revealed that 73% of Americans consider environmental factors like carbon footprint when choosing where and how to invest their money. Seventy-one percent said they’d stop investing in a business they believed was unethical. In the survey, respondents detailed some of the practices that make them want to invest in a company:

  •     A safe working environment for employees 
  •     A living wage and quality health insurance for workers
  •     Transparency about business practices and finances
  •     Conservation of natural resources   

Shoppers also are increasingly letting their consciences guide their purchases. The future is looking more and more environmentally conscious. Today’s consumers expect the companies they do business with to be good stewards of the environment. Globally, 81% of people say that companies doing their part to improve and protect the environment is extremely important or very important, according to Nielsen data. Meeting that expectation is crucial to remaining relevant to shoppers or clients. 

The triple bottom line

One way to examine and compare companies’ social responsibility is an accounting framework known as the triple bottom line. The term “triple bottom line” refers to three important measures of your business: 

  1.     Profit: Difference between revenue and costs 
  2.     People: Relationships your business with its workforce and with its community as a whole
  3.     Planet: The efforts made to minimize harm — including tracking and shrinking its carbon footprint 

Proponents of the TBL framework say companies should be just as concerned with their social and environmental impacts as they are with making money, and they should report these results alongside their financial bottom line. These elements demonstrate different types of sustainability to outside parties like investors, consumers and partners: 

  1.     Socially Sustainable: Strong relationships with employees and the communities they serve  
  2.     Environmentally Sustainable: Effectively manage carbon footprints 
  3.     Economically Sustainable: Viable business models and contribute to the economies they operate in 

Overall, 84% of Americans perceive businesses that are good corporate citizens to have better long-term prospects than those that don’t.

Greenhouse gas emissions are a key part of the “planet” bottom line. Creating and enacting a plan to measure and report emissions data helps you hold your business accountable. It also prepares you for mandatory carbon reporting, which may become relevant when you expand operations to a new country or if your current jurisdiction increases requirements.

Setting the GHG management standard

Competition is something you can’t avoid in business. If your competition is effectively communicating its progress toward shrinking its carbon footprint, you can’t afford not to. Being late to the party is still better than never showing up, but both the environment and your company’s reputation will benefit from managing your carbon footprint as soon as possible. This healthy competition creates pressure for more and more SMEs to get with the program, raising the bar for everyone.

Small business is also all about community. Sustainability can be an opportunity to position your company as a leader in the business world, paving the way for other SMEs to make earth-friendly changes. This could create valuable partnerships with other businesses that may become clients or vendors.

Connecting with like-minded vendors and partners can help SMEs reduce their carbon footprints even further. That’s because emissions from the supply chain equal about five and a half times the emissions from a company’s direct operations.

What GHG management means for you

GHG management can be overwhelming for small and medium-sized companies. Yet the urgency of today’s climate situation and the business benefits of tracking and reporting greenhouse gas emissions are too great to ignore.

UL’s Turbo Carbon™ software simplifies the process of collecting all the necessary data in real time and producing helpful reports to make sense of the numbers. With the touch of a button, you’ll have audit-ready reports, and you’re always backed by UL’s sustainability experts. 


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