According to The British Chambers of Commerce, only one in ten small businesses measure their carbon footprint, with the main reasons for this being lack of knowledge, skills and funding to effectively make changes.
So, what exactly does the term ‘carbon footprint’ refer to? Simply put, it is a measure of the amount of greenhouse gases produced during all operations of your business. This includes everything from the energy used to power your offices, to the carbon emissions of your suppliers.
In this guide we help you understand what your business carbon footprint consists of and take you through the best way to calculate and reduce it.
Why is it Important to Measure and Reduce Your Business’s Carbon Footprint?
There are many reasons for a business to reduce their carbon footprint that can benefit both the business itself and the planet, as well as aligning with the Net Zero goals of the UK government. In 2019, the UK government set the goal of reaching net zero by 2050; the aim being to produce no emissions, unless they can be offset by schemes such as reforestation. By calculating and reducing your business carbon footprint, you can align yourself with these goals and help future-proof your business.
It is no secret that businesses contribute heavily to climate change, with 71% of global emissions being produced by 100 businesses. This means that in order to make any meaningful progress with regards to global emissions, this change needs to come from both businesses and individuals.
By reducing your carbon footprint, you can also reap benefits for your business, improving relationships with customers, suppliers and business partners alike. According to NIQ’s Green Divide Report, ‘70% of consumers say sustainability is now more important to them when selecting products than it was two years ago’, meaning that by adopting more eco-friendly practices in your business, you will be appealing to a wider consumer base.
Similarly, if you operate a B2B company, your partners and suppliers may request your greenhouse emission data before working with you, this will validate your environmental efforts and ensure your partnerships are as green as they can be.
How to Calculate Your Business Carbon Footprint
When calculating your business carbon footprint, it is important that you take a holistic approach, taking into consideration all the factors that affect and contribute towards your overall score. These can be divided into three categories; scope one, two and three emissions, and should be measured over a period of 12 months.
Scope one emissions – direct emissions such as fuel burnt on-site, and emissions produced by company-owned vehicles.
Scope two emissions – indirect emissions from sources purchased by your company e.g. electricity and gas.
Scope three emissions – emissions that come from external sources that your company are indirectly responsible for, such as those from your suppliers and partners and your customers when using your product. Scope three emissions can account for up to 70 percent of a business’s carbon footprint and are often the most difficult to regulate, making them easy to overlook.
When measuring your carbon footprint, some examples of things you’ll need to factor in include;
- Electricity use (total kWh from electricity bills)
- Gas use (total kWh from gas bills)
- Waste disposal and recycling
- Company vehicle emissions
- Employee travel (e.g. to and from work, business trips etc.)
- Emissions produced from transporting goods
This will look different for every business depending on a number of factors – such as business type and size -, but it is important to take into account every emission-producing activity over a 12-month period, in order to gain the most accurate results.
When calculating your scope three emissions, if applicable, you should also ask your suppliers for their carbon data to use in your own report. This can then be recorded and tracked in a spreadsheet.
Once you have collected all your data, the easiest way of calculating your business carbon footprint is to use an online calculator tool. We recommend using The Carbon Trust but whichever tool you choose to use, make sure it is from a reputable source.
What to do with Your Business Carbon Footprint Data
Once you have collected your data and calculated your annual greenhouse gas emissions, you can then use this information to identify areas for improvement, save money on your energy bills and track your progress.
By comparing yourself with the average for your business type, size and industry you can use this information to gauge the level of improvements you should aim to make and set yourself quantifiable targets that can be reviewed in a years’ time when you recalculate.
You can also use your findings to monitor changes over time and demonstrate your improvements to customers and business partners. Though not a legal requirement, publishing your data may benefit your business, particularly if it displays a degree of eco-consciousness which potential customers may actively look for when choosing where to spend their money.
Perhaps the most valuable way you can use your business carbon footprint data is to help you plan new initiatives when it comes to reducing your environmental impact, as well as tracking the effectiveness of the changes you make.
How to Reduce Your Business Carbon Footprint
There are many things you can do to effectively reduce your business’s carbon footprint, ranging from small changes to the way you use energy and recycle waste, to larger changes such as introducing new energy saving infrastructure for your business.
A great starting point is to incorporate renewable energy into powering your business. This doesn’t necessarily mean you have to invest in installing solar panels or wind turbines, but you could opt for the much more convenient method of switching your energy to a renewable plan. At Yü Energy, we offer 100% renewable, REGO-backed energy plans, meaning that you could go completely carbon neutral when it comes to your utilities.
Another effective way of tackling your carbon footprint is to electrify your transport. This could mean introducing an entire fleet of company vehicles, or simply installing electric vehicle charge points for your employees and customers to use.
To find out more about how you can use your findings and reduce your business’s carbon footprint, check out our recent blog on ways businesses can reduce their carbon footprint.
Conclusion: Calculating and Reducing Carbon Footprint
While it may seem an overwhelming task, especially for small business owners with lots of other tasks to prioritise, calculating your business carbon footprint is the first step towards positive long-term changes both for your business and the planet.
For more information on reducing your business carbon footprint, be sure to check out our news page, where we share industry-specific tips and practical ways to implement green changes.