Toxic shock
Who would have predicted that carbon offsetting would become a victim of the downturn? FMs must help their firms keep a level head about such a critical issue. Neil Harrison explains how
by Neil Harrison
One of the more intriguing casualties of the recent economic downturn started life as the darling of the commercial world. Carbon offsetting allowed business to do its bit for the environment. Yet in the first two months of 2009 alone, sales of voluntary credits to offset projects plummeted by more than two-thirds compared with the previous two months, according to a survey by New Energy Finance.
This may be due partly to a shift away from a system widely seen as a ‘feel-good’ purchase, with little that was positive for the firm or the communities associated with the offsetting projects. Whether this is a valid criticism, the unregulated nature of the market and questions about the effects of ‘pay to pollute’ raised by the likes of Friends of the Earth have not been encouraging.
The retreat from offsetting may also be a sign that organisations are looking at more substantive, long-term objectives for their green strategies. The Carbon Reduction Commitment (CRC), which comes into effect in April 2010, may also be dampening interest in offsetting. Under the CRC, some 20,000 British firms with an electricity consumption of more than 6,000MW/h will be required to buy energy allowances. It comes in the wake of other schemes such as revised Breeam standards and the BRE’s work with the Department of Communities and Local Government clarifying elements of the Energy Performance of Buildings Directive and in particular the Energy Performance Certificates. Through the CRC, the government aims to save 4m tonnes of carbon dioxide a year by 2020, a commitment that is encouraging companies to question why they should buy carbon offsets as well.
Certainly there is a very strong case for firms to invest in reducing energy consumption as a priority. A recent report by the Carbon Disclosure Project makes the point powerfully by showing how corporate investment in energy efficiency has been rising during the recession as companies look for a combination of cost and carbon savings they can measure easily.
Global watchword
Efficiency rather than trading is the new global watchword. Within 100 hours of his inauguration Barack Obama announced that he expected federal agencies to make all government buildings far more energy efficient. He had a target in mind — annual energy savings of up to $2bn (£1.5bn) alongside a reduction in emissions of carbon dioxide and other gases blamed for global warming.
Reductions in carbon emissions and reduced energy costs are among the most important objectives for the owners, builders, occupiers and designers of commercial property in the UK. It was telling that 2008 saw the UK government latch on to the fact that buildings are responsible for around half of the UK’s energy consumption and carbon emissions.
All of these developments are to be welcomed because they signal a new maturity in the market. Hopefully, by focusing on business objectives, including the bottom line, they will sweep away the cynicism that has dogged attempts by firms to formulate effective environmental policies.
Yet, while a degree of scepticism around marketers is always healthy, many environmental claims were automatically labelled as greenwash, whether they deserved it or not. This is a real shame because what has become evident as the environmental debate continues, is that the response from manufacturers and suppliers has developed in parallel. Cynicism does no favours to those people making genuine efforts to reduce their environmental impact.
It can be damaging too. The confusion generated by the claims and counter-claims is evident in the results of a recent Ipsos Mori poll which showed that while around 90 per cent of people are concerned about climate change, they’re baffled as to what they can do about it. Meanwhile The Climate Index Report produced by HSBC claimed that this trend would only worsen as people become even more cynical and confused, predicting that buyers may revert to choosing be means of their traditional concerns — value and brand.
That would be an incredibly unfair and unwise outcome given the work that is going on to develop new products and services. However, there is good reason to believe that this worst case scenario will not come to pass because both firms and customers want the same things.
Whipping boy
Research published by YouGov showed that around 56 per cent of businesses claim that they are taking significant steps to lessen their environmental impact, while more than a quarter believe they are doing everything they can.
The idea that a green policy was formulated largely for marketing reasons or as a salve for the conscience rather than the salvation of the environment has distorted debate.
This was typified by the introduction of the new Breeam standards in 2008. The Breeam accreditation process had long been a whipping boy of the green movement, often criticised for being overly commercial or for placing too much focus on peripheral issues such as the provision of bike racks.
The new system was far better, clearer and with sharper teeth. Even so, the building and property press tied itself in knots picking it apart. What we now see is that in spite of the inevitable flaws inherent in any process dealing with such a complex and fast-moving issue, it is a welcome step in the development of a greener approach to building design.
What is clear to me is that the whole complex, multi-faceted debate about what can be done to stop or at least minimise our impact on the environment has to move away from the cynicism.
We all have a role to play in this. Legislators must stop companies making misleading or misinformed claims about their products and services. Companies must clarify their language, innovate, speak in their own voice and back up their own claims. And we must all become less cynical and better informed about what to look for.
We must also maintain perspective on what suppliers are doing to address the most important environmental issues we face. Very few suppliers set out deliberately to mislead their customers. In fact, the vast majority have taken significant and genuine steps to deal with their environmental impact. Many spend large proportions of their R&D budget on developing new materials, processes and systems that offer radically new responses to green issues.
They do this for their own ethical reasons and because they understand that they need sophisticated and genuine products to respond to the demands of their customers. After all, we’re all in this together after all.
Neil Harrison is customer marketing manager at RS Components
