Carbon Management After Copenhagen: State of Green Business Forum - Chicago

Why should companies worry about carbon management given the lack of a definitive outcome from climate talks in Copenhagen, GreenBiz.com Senior Contributor Marc Gunther asked panelists at the State of Green Business Forum in Chicago.

There are probably companies or corporate leaders thinking, "nothing happened in Copenhagen to incent me," Gunther said. "What's in it for me to manage my carbon and reduce my footprint? What's the business case?"

Gunther posed the challenge to Allison Hannon, Midwest regional manager of The Climate Group, United Parcel Service Senior Director of Sustainability Sunny Davis Nastase and Motorola Inc. Senior Director of Environmental Initiatives Don Bartell on Tuesday in the final session of the daylong program that highlighted key findings of the annual State of Green Business Report.

At Motorola, the drivers are "cost and market differentiation," Bartell said. "Motorola is a low-impact user. For us, the game really hasn't changed as a result of Copenhagen."

What has changed in recent years is how the company has made energy a focal point. "We're looking at energy differently," Bartell said.

Motorola hones in on energy in four key areas, he said:

  • The products the company builds and ships. Efforts to reduce energy consumption include shrinking a cell phone box to half the size it was in 2007 and designing a phone with plastic that's 25 percent recycled water bottles.
  • The firm's business operations. Motorola is a charter member of the Chicago Climate Exchange and uses renewable energy through the purchase of renewable energy certificates (RECS).
  • "The power of communications." The development of communication tools and technology that enable workers to be more efficient, such as helping drivers to get to their destinations faster.
  • Product design. Making set top boxes, cell phone charger and other devices that operate on less power. Motorola was the first major cell phone manufacturer to redesign all its mobile phone and accessory chargers to be Energy Star-qualified.

{related_content}For UPS, "green in laymen's terms means cost -- you've heard of our eliminating lefthand turns and other initiatives (to cut costs, energy consumption and emissions) -- the carbon metric helps us get there," Nastase said of her firm's motivation to manage carbon. "So there is a cost-driven element to it and there is also an environmental element that is important to us."

Nastase touched on UPS's environmental record and its nearly eight-decade use of alternative fuel vehicles, starting with electric delivery trucks in the 1930s.

The delivery company operates the world's ninth largest airline -- Nastase said it also is the most efficient -- and 53 percent of its carbon is a result of its air transportation, she said. The number of flights the firm runs depends on how much is being shipped and when. As is typical for the delivery business, a flight will usually "cube out" from packaging before it "loads out" in weight, she said

"We can't control the number of flights and what goes in them, so we reduce what we can control," said Nastase. "We reduce what it takes to move one ton one mile through the air."

That means traveling at slower speeds and right-sizing packages, among other things. "The aircraft we choose also is no small part of the equation," she said.

"We measure everything -- every vehicle on road, every plane in the air -- we have a very refined idea of the carbon footprint today of our products, and we use the data to measure our own carbon footprint," said Nastase.

That data also enables UPS to offer a contract service, launched last fall, to calculate the carbon footprint of a customer's shipping activities. High-volume clients can buy offsets through UPS to countervail the carbon impact of their shipping, which then bear a carbon neutral label. In announcing the program, UPS said it will match the amount of offsets purchased by up to $1 million.

"This is the first zero-revenue product for UPS in its 102-year-old-history," Nastase said.

Gunther raised the issue of targets during the session.

Motorola reduced it carbon footprint by 20 percent since 2005. In its corporate responsibility report last year, the company listed absolute and normalized goals including a 6 percent absolute reduction in greenhouse gas emissions to achieved this year.

UPS has a goal of reducing the carbon intensity of its UPS Airlines operations 42 percent by 2020, compared to 1990 levels, Nastase said.
 
When it comes to setting goals, targets and commitments, aren't pledges for absolute reductions in emissions preferred over promises to reduce intensity, Gunther asked Hannon. A firm could reduce the carbon intensity of its operations and still be emitting more than it did in the past, he noted.

"We need absolute reductio, but the reality is it's going to be easier for some people than others," said Hannon, who cited the example of a firm that recorded signification reductions and "looked great, but then they were really inefficient" so it was easy to achieve reductions.

The important thing its to look at what targets a firm has set and determine whether those goals address the area of the business in which the company has the most impact.

"In the case of UPS its they're flying," Hannon said. "If we were talking about a bank, I'd look to see where they are investing."

Closing out the program was an appearance via telepresence by Doug Scott, the director of the Illinois Environmental Protection Agency.

In congratulating Greener World Media Chairman and Executive Editor Joel Makower and GreenBiz.com for their first forum in the state of Illinois, Scott told Makower: "I agree with you that the green economy is nascent -- but it is growing."

Illinois, where 10 wind companies have made Chicago their headquarters, and other Midwest states have very aggressive legislation coming on renewables, Scott said.

The region has a history of environmental leadership. The Illinois EPA is older than the US EPA and operates the country's longest-established EPA lab system. 

The article about the presentation of this session in San Francisco is available here. Also see the video of the West Coast presentation and a toolkit of downloadable resources.

The State of Green Business Report 2010 can be downloaded using the button below.


Full coverage of the State of Green Business Forum is available by clicking the icon immediately above or by visiting GreenBiz.com.