Why Kiwi businesses need to factor carbon accounting into their business plan
Climate change is impacting our planet – it’s no secret. New Zealand, heading towards a Net Zero goal by 2050, has launched such initiatives as climate-related disclosures mandatory for some businesses, e.g. publicly listed companies and large insurers, banks, non-bank deposit takers and investment managers. The goal is to help New Zealand meet its international obligations and achieve its target of zero carbon by 2050.
While the mandatory disclosures currently only apply to enterprise-level organisations, it’s indicative of what the future holds for all Kiwi businesses. Forward-thinking, proactive CEOs of over 100 leading New Zealand businesses have formed the Climate Leaders Coalition, recognising the role that business can play in reducing emissions and signing a joint statement, which commits their companies to action.
Some businesses have already started. Stats NZ recently said that over the past two years, 35% of Kiwi businesses invested in various measures to reduce greenhouse gas emissions or adapt to potential impacts of climate change, and that the most common investments they made were in new software or digital technologies.
We all have a responsibility to tackle the climate change challenge, and for business owners, this means building carbon management into their overall business strategy. Taking steps to actively reduce their carbon footprint means SMBs will benefit in a number of ways, including:
- The same goes for customers – many want to purchase from a business that is transparent about their activities and their impact on the environment – 81% of people prefer to buy from sustainable sellers. An independent study commissioned by Smartest Energy reveals that consumers are increasingly favouring brands with a commitment to environmental sustainability.
- Economic – carbon accounting will identify business activities that use a lot of energy, so they can be reduced, and resources can be allocated more efficiently.
- Low costs can help set better pricing without affecting margins, which attracts more customers.
- The ability to attract top talent who want to work for a sustainably responsible company. Unily revealed that 83% of workers thought their employer was not doing enough to be more sustainable and tackle climate change. What’s more, 65% said they would be more likely to work for a company with robust environmental policies.
And obviously, a carbon management strategy enables SMEs to become environmentally conscious about their carbon emissions, so they can take active steps to reduce them.
“Carbon management is a growing area of focus for organisations as pressure to adopt future zero carbon targets grows, and carbon pricing volatility increases, and many companies are now measuring and reporting on their emissions and increasingly taking action to understand and mitigate their carbon impact.” PWC.
So, what exactly is carbon accounting? In a nutshell, it’s about measuring the carbon emissions of a business’s activities into the Earth’s atmosphere and is sometimes referred to as a greenhouse gas (GHG) inventory. And with climate change on the rise, and watching the way the NZ Government is inclined, carbon accounting will become an increasing industry-standard requirement for many businesses. The good news is that there is now a range of innovative tools and technology available to make it easier for businesses to accurately calculate, monitor, and track their carbon emissions and CO2 reduction efforts.
By now you’re probably thinking, “OK, so how do I get started?” We understand that it might seem quite daunting, so to help you begin your sustainability journey, we’ve developed an eGuide that will set you on the path. It covers these key areas:
- Why carbon accounting is now key for business success
- The challenges SMBs face around carbon accounting
- Why digitisation is a carbon management game-changer
- An introduction to our innovative and intelligent carbon management solution, CarbonHub
Once you’ve got a carbon management strategy in place, with the right tools to implement it, you’ll gain the insight you need to quantify and measure your company’s carbon emissions, as well as making informed decisions when it comes to your carbon and mitigation strategies.