5th International Conference : Workshop - Business
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5th International Conference : Workshop - Business 5th International Conference : Workshop - Business Presentation Transcript

  • © Sustainable Opportunity Solutions Ltd 2013 1ICARB WORKSHOP:Making Carbon Information WorkFor BusinessPaul Adderley, 13 March 20135th International ConferenceInitiative for Carbon Accounting (ICARB)
  • © Sustainable Opportunity Solutions Ltd 2013OUTLINE!  Introduction!  Carbon’s Global Context!  Carbon Information:–  Internal Business Benefits–  External Business Benefits!  Table Discussion Topics!  Conclusions: Future is Approaching Fast2
  • © Sustainable Opportunity Solutions Ltd 2013Carbon’s Global Context33bnMore middle income consumersin CHINDA by 2030Rise in Energy Costs &Price Volatility70%Efficiency Opportunitieswith at least 10% returnSource: McKinsey Global Institute1C100yrs show unprecedented rapid risein global temperatures for 11,300yrs
  • © Sustainable Opportunity Solutions Ltd 2013Using Carbon Information4
  • © Sustainable Opportunity Solutions Ltd 2013Business Evaluation5Businesses respond to clear market signals:opportunities and risksImpacts Profitability & CashflowFocuses Investment withMax ROI to stakeholders
  • © Sustainable Opportunity Solutions Ltd 2013Finding ROI through aCarbon LensCarbonInformationIdentifyInefficiencies/exposuresConstraintsCreate InnovationStaffEngagementEnhanceReputationSupply ChainPressures6
  • © Sustainable Opportunity Solutions Ltd 2013Internal Business Benefits7
  • © Sustainable Opportunity Solutions Ltd 2013Identifying Inefficiencies8!  Carbon as measure of inefficiency & cost–  Carbon per tonne of product, hour worked, £ Turnover(Carbon Intensity)!  Process ReviewInputsProduction/ServiceOutputsInfrastructure/ Energy NeedsStorage  Waste  Logis-cs  Storage  Waste  Logis-cs  Processes  Packaging  
  • © Sustainable Opportunity Solutions Ltd 2013Case Study: Process Efficiency!  Business Outcomes–  Better Procurement: RightQuantity, Time and Place–  Use of local suppliers toreduce logistics–  Reduced waste (stockdamage & obsolescence)–  Reduced travel & time–  Adaptable: Increaserevenue opportunities9!  Carbon Outcomes–  47.8 TCO2e Saving–  Carbon Intensity reduced by27%–  48.7 TCO2e vs business asusual–  Verified by Carbon TrustStandard–  £27,500 cost savings–  Carbon ROI 16TCO2e /£’000!  Action by Construction Business–  Closed large warehouse facility to reduce fuel/energyuse & compliance risk
  • © Sustainable Opportunity Solutions Ltd 2013Low Carbon Infrastructure!  Scottish SME Food Producer (estimates)Reduce Energy Use & maintain Carbon Commitments10324,000125,000LEDLIGHTINGOLDLIGHTING30 184£’000/yr11 67Carbon(TCO2e)kWh33%10 TCO2e/£’000ROILife Time Carbon ROI
  • © Sustainable Opportunity Solutions Ltd 2013Renewable Infrastructure11ActualCAPEX £98,000Income & Savings £16,000 (FITs Feb 2012)ROI 16%Annual Generation 37,131 kWhOn site Use 60% 22,279 kWhCarbon Savings 19.5 TCO2eCarbon ROI 5 TCO2e /£’000Midlothian Manufacturing Business:reduce carbon emissions & exposure energy price volatility
  • © Sustainable Opportunity Solutions Ltd 2013Staff Engagement:Making Carbon Tangible!  Eco-Driver Training backed up with data£2.5k Fuel Savings12Pride inAchievementsShare BenefitsCarbon Savings5 TCO2e YTDCarbon ROI25 TCO2e12345678£2.5k Savings12345678
  • © Sustainable Opportunity Solutions Ltd 2013Carbon ‘Opportunities’ Hierarchy13BehaviourMonitoring &CommunicationEfficiency ProcessesRenewables InfrastructureIncreaseinCapitalCosts&ReducingROI
  • © Sustainable Opportunity Solutions Ltd 2013External Business Benefits14
  • © Sustainable Opportunity Solutions Ltd 2013“Baking-In” Reputation!  Growth of Ethical Market - £47bn (2011)!  Generally Recession Resistant15
  • © Sustainable Opportunity Solutions Ltd 2013Supply Chain: Pass it on!  Global CEOs expect–  “low carbon” innovation from the supply chain–  suppliers to contribute to a shared agenda(source PwC: Factoring Sustainability into IPO Planning, October 2011)!  Supply Chain Analysis reaching Scottish SMEs–  Global Companies requesting Carbon Data (Ecodesk)–  Carbon Footprinting of Seed Potatoes Bags!!  Public Sector Procurement (Reform Bill)–  Drive to increase SME access to public contracts–  No clear signal how carbon will be assessed–  Operational and capital carbon and cost impacts16
  • © Sustainable Opportunity Solutions Ltd 2013Upstream Risks!  Financial KPIs - Gross Margin, may not highlightsupply chain risks!  Is Carbon KPI a possible identifier of exposureto ?–  Responsiveness: Local vs Global–  Freight costs volatility (air vs surface)–  Climate Disruption–  Opaqueness/lack of transparency in supply chai (datacollection)17
  • © Sustainable Opportunity Solutions Ltd 2013SuggestionsTable DiscussionBusiness Topics1.  For three business objectives consider how measuringcarbon impacts adds value (or not), and why?2.  For a production/service process think how carbonefficiency (CO2e /unit) could be improved? (energy/waste)3.  What knowledge/expertise is there in your business torespond to the opportunities/risk in a low carbon economy?Policy Topics1.  How can public policy encourage carbon measurement &reporting by SMEs without legislative measures?2.  Would also setting carbon budgets for public sectorprocurement make better decisions ? Discuss.18
  • © Sustainable Opportunity Solutions Ltd 2013The future is approaching fast!  Can’t manage if we don’t measure.!  Carbon is a measure of efficiency!  Carbon KPIs work alongside Financial KPIs!  Assess supply chain risks!  Ready to create value in the supply chain!  Requires adaptive business models19
  • © Sustainable Opportunity Solutions Ltd 2013Carbon reporting is a lever to discover other business benefits& manage risks, not a merely number crunching exercise.And finally…an Accountant’s View
  • © Sustainable Opportunity Solutions Ltd 2013Further Information:Email: pauladderley@sos4business.uk.comWeb: www.sos4business.uk.comTel: 0845 475 1275 / 07917 37257321