Product-level Scope 3 data, nature-related risk measurements and energy intensity metrics are among the experts' dream data pipelines.
Good afternoon! In today's edition, we asked the experts to describe the data that they thought would make the biggest difference to sustainability professionals as companies looked to push ESG missions forward. Questions or comments? Send us a note at firstname.lastname@example.org
President of sustainability business at Schneider Electric
Global organizations decarbonizing their operations and advancing their sustainability missions are turning to digital solutions to collect and aggregate cross-enterprise energy and sustainability information. A surprising number are still using disconnected, or even manual entry, systems to manage energy consumption and carbon emission data. Digital systems – especially those driven by AI – can reduce the burden of data management while improving the accuracy and availability of data.
Understanding what a company’s baseline environmental footprint is, and how it is making progress towards its goals is essential for credibility. For the officers and professionals who oversee execution of an organization’s sustainability mission, accessing complete environmental data from their supply chain is becoming essential to advancing a company’s objectives.
Most of a corporation’s carbon footprint resides in its value chain. CDP has estimated that the supply chain contains an average of 11x more emissions, for most companies, than their own operations.
These emissions are categorized as “Scope 3”, which are more nuanced than emissions produced by direct organizational activities (Scope 1) or those generated by purchased electricity, heat/steam, and cooling (Scope 2) emissions. In total, Scope 3 broadly represents all other indirect emissions, including those from the value chain. These emissions occur because of a company’s operations but are produced from sources neither owned nor controlled by the company.
Organizations are quickly realizing that securing access to primary data from their value chain – such as supplier data and customer data – is critical to advancing a company’s sustainability mission and meeting ambitious decarbonization goals.
Chief sustainability officer at Chemours
Government and policymakers around the globe continue to seek transparency on sustainability risks and opportunities, and customers increasingly ask questions about carbon handprint and footprint. This trend isn’t going away and underscores how capturing data on carbon emissions across the lifecycle is incredibly important.
Currently, in the supply base, accessing actual, reliable data is a challenge as most information is based on an estimate or model. Access to accurate data allows for true product or material comparisons in their application and the entire lifecycle. Making decisions based on what is available cradle-to-gate is not enough. To further advance companies’ sustainability missions, they need to be able to make decisions based on data related to a products’ imprint. Technology breakthroughs with security protections for sensitive intellectual property or CBI – potentially enabled by blockchain – could help bring this information together across complicated value chains.
Another potential “hole” in data that could help enhance sustainability missions is around nature-related risks. Building on the Task Force for Climate-Related Financial Disclosures (TCFD), there is a movement to increase focus on valuing nature through the Task Force on Nature-Related Financial Disclosures (TNFD). While a beta version of these disclosures was recently published, and a final version isn’t expected until 2023, data and metrics to support nature-loss related risk assessments will be critical.
Head of sustainability at Convoy
Quality data would be most helpful to advance a company’s sustainability mission. Rather than robust quantitative performance indicators, most sustainability metrics are collected as check-box yes-or-no responses, generic boilerplate language, or case study examples. These types of metrics are weak indicators for how sustainability impacts business performance. We need sustainability reporting to move to quantitative, with metrics such as energy intensity or absolute carbon emissions reduced.
Additionally, consistent reporting metrics are necessary. The fact that sustainability reporting is voluntary makes for messy data. Neither the metrics nor the accounting methods are consistent. This limits comparability across companies and remains one of the greatest limitations to sustainability progress.
CEO at Aspiration
What we measure is what we do, and the data frontier for companies is actionable measurements of their Scope 3 data — the emissions produced not by the company itself or by the energy it buys, but by all the goods and services it buys and sells. There is good data out there on the average carbon emissions of various industries and Aspiration and a few others are now able to provide data at the company level, but the next frontier is product-level data so companies can change how they do business.
CEO at Emex Software
Call it Carbon Tunnel Vision or the Carbon and Climate Frenzy. We all know that regulators, investors and consumers have been giving the E piece of the ESG jigsaw considerable attention in recent years and months. There has been considerable focus on how to measure carbon footprints and offset them. For sure, a lot of progress is being made. But is this where all the focus should be? Let’s take a step back and think through how we improve our climate and planet. We need to:
- Produce more efficiently
- Consume less
- Share more
- Educate more
- Eat less
Pretty simple, really …
Will the latest TCFD, SASB, GRI or whatever standard help here? Yes, to a point. But my guess is that they will only move the needle slightly. The real thing we need to promote is what I like to call positive societal behavior: corporate and personal. As a software platform and commentator here, I feel that the E piece is being over-invested, and there is not nearly enough focus on the S and G pieces. We need to measure more than just the environmental impact of production, but also the impacts on society.To my mind, accounting for the Environmental piece and building a sustainable planet is driven by great Social and great Governance to patrol it, not only by great accounting for carbon
Chief sustainability officer at Sustain.Life
Right now, the most pressing sustainability issue is climate change: how to slow it, adapt to it and transition our economy and policies to a system that prevents it from getting worse. When we think about business’ impact on the climate, it’s all about carbon accounting: translating business activities to GHG outputs. And because you can’t manage what you haven’t first measured, the best data we can wish for to advance sustainability is access to Scope 3 emissions data, i.e., the indirect climate impact everything it takes to support your business. We have accessible frameworks and reliable data to calculate Scope 1 and 2 energy-related emissions, but businesses are left scraping together bits and pieces for their larger value chain impact, which is generally 90% of their footprint. In a dream world, every business action — everything from software application used, material or product purchased, professional service rendered, etc. — would be accompanied by an emissions figure, allowing businesses to see the full scope of their climate impact and make informed decisions to reduce that impact.
And what’s preventing this from becoming a reality? Two things.
It requires your value chain to measure their emissions, which is extremely hard to do, unless you’re big enough to compel your suppliers to measure and share their data with you.
We don’t have sufficient accessible, reliable, repeatable, consistent data that translates every business' activities to emissions outputs. It simply hasn’t been measured at scale.
Senior director, environment, social, and governance at Workiva
Companies are under extreme pressure to demonstrate their ethical, sustainable, and socially responsible practices through trusted, transparent data, as conscious investors look beyond financial performance and monetary returns from their investments. While companies are spending a great deal of money on actions that improve their ESG goals, particularly within the “S” of ESG, sustainability professionals are left trying to analyze and measure the collision between societal impact activities and financial business value results. In an ideal world, this data would give companies a leg up in quantifying success and driving stakeholder support to ultimately advance their ESG mission. However, the problem remains: there currently isn't an easy way to quantify the impact of new societal policies and how it relates to a company’s overall financial results – leading to murky metrics, and confusion from investors. That said, it’s important for leaders to understand how their organization’s actions are helping drive business value and results. With the right technology, being able to present trusted, transparent data in a standardized and comparable format is not such a fantasy after all.
Vice president of ESG and impact at Autodesk
Investing in technology is necessary to accelerate the transition to renewable energy and pave the way for an equitable, low-carbon future. And technology is enabled by data. How do you reduce the carbon emissions associated with a building, for instance? First, you need to understand the energy consumption of the building and carbon associated with the bill of materials. There is plenty of data — zettabytes of it, in fact. The challenge is ensuring that the right people have the right data and the right time. This is an exercise in connecting data to existing workflows and processes so that consumers, regulators, investors and businesses understand how to reduce carbon emissions in their respective domains.
The industries Autodesk serves, the built environment and manufacturing, are associated with about 60% of total global CO2 emissions. Nearly 90% of Autodesk’s largest customers are committed to sustainability. and yet they need help to meet their climate targets. A big hurdle to doing so is understanding where energy or material usage can be reduced — leading to less carbon emissions. Autodesk is focused on enabling our customers by connecting disparate data sets, allowing for automation and insights that help them drive toward the outcomes they seek to achieve. The opportunity here is to use materials and energy more efficiently, save money, reduce waste and move toward that low carbon economy. Only when people have the right tools and data at their fingertips are sustainable outcomes possible.
Executive director at the Coalition for Reimagined Mobility
Lack of supply chain insight is among the biggest gaps in advancing sustainability, especially considering the huge role that freight transportation plays in greenhouse gas emissions. In order to promote emissions reductions in this space, we first need to understand the main drivers of these emissions.
Data has a huge role to play here. To ensure operational visibility, information transparency, and drive insights for sustainability, we need to invest in a digital freight system powered by broadly adopted open-data standards. Unfortunately, solutions today are unevenly distributed across the value chain, and fragmented communication results in inefficiencies and excess emissions.
Every company buys things – be it printer paper or large machines for a manufacturing line, which means that all companies have the means to start asking questions about how items arrive at the work place. Being able to understand the location and idling activity of transportation in the freight sector can deliver the right level of insights for companies to start making more sustainable decisions on the transport of its goods. We are seeing this on the consumer side and it will need to move into the enterprise if we are to gain a holistic view of these efforts.
If sustainability professionals (and, in turn, the supply chain) had greater visibility on how goods were shipped, including idling time and mode of transportation, they’d be better positioned to determine which supplier or logistics provider is the most efficient or sustainable option to help them meet energy goals.
CEO at Yotascale
Businesses will be able to take ownership of reducing their cloud carbon footprint not only by reducing the "macro-wastage" of compute, but also by identifying "micro-wastage" in their shared infrastructure that can negatively impact their cloud costs and carbon footprint in the cloud. Engineering and finance need granular and dynamic data that tells them not only how each decision impacts the bottom line, but also how each choice impacts the carbon footprint left by the company.
Kevin McAllister ( @k__mcallister) is a Research Editor at Protocol, leading the development of Braintrust. Prior to joining the team, he was a rankings data reporter at The Wall Street Journal, where he oversaw structured data projects for the Journal's strategy team.
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