What makes BT's Net Good carbon program a game-changer?

What makes BT's Net Good carbon program a game-changer?

This article represents the premiere of a new column, "Game Changers," focusing on the intersection between innovation and sustainability in business, showcasing game-changing innovation approaches, people and trends.

BT's Net Good program is a component of BT's Better Future Program, which focuses on helping society live within the constraints of the planet's resources. Net Good applies an updated carbon abatement methodology across the supply chain, customers and internal operations. It aims to also have a wider impact for other businesses to move forward on their carbon abatement efforts. With its June 2013 launch, BT launched some new products. These translate into sales and business growth. I met with Kevin Moss, the head of BT's Net Good program. We spoke about BT's aspirations to become "net positive."

Susan Nickbarg: Please describe the Net Good program.

Kevin Moss: The vision of BT's Net Good program is to help society live within the constraints of the planet's resources through our products and people. The program's overarching goal is to help our customers reduce carbon emissions by at least three times the end-to-end carbon burden of running our business. We will achieve this by minimizing the negative and maximizing the positive impacts delivered by our products and people. Net Good means that the positives outweigh the negatives. By pursuing the goal "Net Good," we are shaping and accelerating the transition to a more sustainable, low-carbon economy. I work closely with the business units as together we innovate solutions towards this goal.

Specifically, our current goal here in BT's Net Good program is to help customers reduce carbon emissions by at least three times that amount by 2020. As of 2013, the total carbon emissions of BT's business created roughly equaled the emissions our products and services helped customers to avoid.

Nickbarg: What is the carbon reduction goal of the Net Good program and how has it expanded from before Net Good was launched?

Moss: It is a 3:1 goal based on the premise that BT is directly responsible for emissions resulting from its own operations. For example, this includes the network, offices, commercial fleets and company cars. We also hold responsibility for emissions at both ends of its value chain: in our supply chain (product and service production) and from the products and services used by BT customers.

We have a methodology we also want to share with other businesses and industries to help them move forward with their carbon abatement efforts. We also use our customer's feedback to further shape evolution of the methodology. The Net Good methodology and framework form part of BT's Better Future program, which encapsulates BT's commitment to be a responsible and sustainable business leader. It is a pledge set as one of BT's six strategic priorities.

Nickbarg: BT has been a forerunner to invest and proactively coalesce the Net Good program that you lead. Please explain the concept of "net positive" on which the Net Good program is related and why it's considered game-changing.

Moss: The concept of net positive means that an enterprise is contributing more in its chosen area for driving positive impact and mitigating negative impact. For example, we aligned the Net Good program to the environmental space. If we look retrospectively at what we were doing with our carbon footprint, you could say that we were doing "less bad" environmentally. It was not enough for our company. We needed to contribute "net good," especially being in the ICT sector. We wanted to show that the carbon reductions we made for our customers were more than the carbon we emit across our entire value chain. We also wanted to show that "net positive" has replacement value beyond our internal operations and across our customers and supply chain.

We are now part of the Net Positive Group with Forum for the Future, the World Wildlife Fund and the Climate Group helping to bring clarity to this emerging concept. We are one among one half-dozen companies now involved. All the members of the group have already made, or are working towards, a public commitment that will ultimately mean that they have a positive impact on the communities and natural environments they operate in. We work on a report called the Net Positive report where we are trying to broaden this concept of "Net Positive" for other businesses. One way to answer the question of how much is enough in sustainability is through application of the net positive idea, including to other related impacts such as health, nutrition or waste.

Nickbarg: Is there a backstory behind the Net Good program in how the goals were formulated?

Moss: We formulated the goals before we finalized the methodology or fully understood how we were going to deliver it. We set the goal within the order of magnitude we thought was necessary and with a view to capturing the entirety of our carbon burden. Our goal could be called an aspiration goal. We established it at the board level first.

Having then defined the methodology, we're still working on the third part about how to deliver it. The important thing to share is that the current gap challenges actually end up inspiring the business units to find ways of solving said challenges. The unknowns help us to fire up our problem solving skills. If we had a complete plan, we would not have the challenge to work on ourselves to change.

Nickbarg: What is the methodology of the Net Good program?

Moss: In order to embed sustainability throughout the business, you need to give tools to your non-CSR colleagues that are intertwined to the context of their role. One of the most leverage-able points is the design of new products.

Here it would be first to identify the CSR opportunities to include in product development and use requirements. Second is getting them prioritized. Third is actually having the CSR related product development and use requirements placed into the final product or service design. Our product and service managers have checklists about CSR related things they are asked to think about (and our now familiar with). It goes beyond the usual legal, technical, operational and compliance types of product design concerns.

At BT we call our product checklist "Designing Our Tomorrow." It quickly helps to get BT's product managers to key into sustainability issues and relate them to design solutions. If, for example, the big materiality issue for a product is to recycle packaging, we can flag it at the design stage. And then act to incorporate potential solutions into the design process.

Nickbarg: How has the Net Good program affected BT's operations, supply chain and customers?

Moss: We used to think of our footprint as our operational activities only. After the debut of the Net Good program, we now think of our upstream, operational and downstream impacts all told. The upstream footprint is the entirety of the supply chain. We capture this using EEIO (environmentally enhanced input and output) analysis.

The downstream footprint includes the in-life footprint of all of our branded and managed products and services. We then compare this footprint to how much our services help our customers avoid carbon emissions through travel and energy avoidance and through dematerialization.

Nickbarg: BT has stated a desire to motivate more collaborative approaches across sectors and to create more net positive outcomes beyond its own tent. How is this unfolding?

Moss: What I can talk about are the sorts of places we envision. Most of which are prefixed by the "smart" word: smart cities, smart travel, smart grid and smart transport. For example, we won an award for a smart vehicle program. In this program, we equipped vehicles with a smart device to travel more efficiently.

The interesting thing here is this one example and many others that we are exploring provide us with important indicators. Our products that consider sustainability problems in their design in turn are helping to create a competitive advantage with new advantages. "Smarter" is where the telecom industry and CSR field is going in terms of product design and delivery.

Nickbarg: What are the key challenges and opportunities around resource management and forging new business models such as Net Good (that doesn't just take and use resources but adds resources and value back)?

Moss: A key opportunity is in the design and launch of products and services that help our customers to reduce their emissions. It helps us to shape and grow our portfolio. Our products that help customers to reduce their emissions will become more and more in demand in the future and help us to thrive as a business. Especially in some future scenarios of higher forecasted energy costs. There will be a clear need for lower carbon options in the future.

Communication technology has a vital role to play in reducing our demand for resources and cutting carbon emissions. For example, our systems can actually help to manage the energy use in buildings or the video conferencing capabilities in certain facilities to avoid carbon emissions.

A key challenge for me in my role at Net Good is the technical challenges. For instance, there isn't a previously established measurement standard. Another challenge is that the business units have many opportunities for investment and growth. Not only do I have to show a business case to the business units, but also I have to compete with internal peers outside of my department for resource prioritization and funding against those the business will actually adopt.

Nickbarg: Has there been any change up or down in inquiries from investors and shareholders related to sustainability since the launch of Net Good?

Moss: We"re seeing a little bit of difference. I'd like to see more. One of the changes we made in our meetings with investors, but it is too early to say the impact. In these meetings we can now relate the revenue value of the products and services that make up the Net Good product portfolio — as well as state it in our annual report. We try and help investors understand where Net Good products sit in the business.

Nickbarg: What shall we anticipate next from BT's Net Good?

Moss: We want to meet our net positive goal that we just announced. We also are working to promote the concept we talked of earlier of "net positive" more widely. We are also actively looking for new products and services to help our customers. We have several pilots we want to turn into products that we can sell on a scalable basis.

Nickbarg: Any parting words about Net Good?

Moss: Net Good expands the whole narrative from risk mitigation and cost reduction to a discussion about business growth and value. It engages a whole new group of people in the company who didn't either know what materiality issues our business and sector were facing. Or, how to take steps to integrate CSR into the business core, which are our products and services.

Now, they have an easy hook to get involved. It makes a big difference to engage and have more employees across more disciplines invested in CSR (business purpose) at a business operations level through our Net Good framework and methodology.

The hardest work is the work of deep-seated sustainable change. BT is one company doing "sustainable change" and making things happen in new ways. The conception of an entirely new business strategy and program, Net Good, is an example of new product innovation and growth driven by sustainability goals. It gives us a business case, which links business purpose, sustainability, and corporate social responsibility with product solutions and operations -- bringing a reservoir of opportunity and growth. An established organization like BT -- replete with technology, markets, and culture -- provides hope about a new way of having a more sustainable business. The BT team is a force of leadership turning the challenges of sustainability into a competitive advantage and force for good.

Are you ready to share your sense of purpose and make your business net positive?

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