Glossary

Plastic Footprint Part I: Insights from a Case Study

by: Leticia Socal and Cassian Bellino | March 22, 2023

ClimeCo’s Plastic Project Partner, The Way Project, Cote d’Ivoire

At this point, we all know there is a global crisis of plastic waste. Consumers rank plastic pollution among the top three environmental issues [1] and have started associating plastic and packaging with environmental degradation. Consumers’ expectations of companies to shift to more sustainable practices have grown. Companies started committing to plastic reduction, recyclability, recycled content, and eliminating problematic plastic. There is so much to do, but where do we begin?

Once a company understands how plastics flow in and out of its value chain, it’s easier to work on plastic mitigation strategies. Plastic footprints are a fast-evolving starter to waste mitigation. They help a company achieve its commitments and plastic-focused ESG (Environmental, Social, Governance) targets. A plastic footprint measures the total amount of plastic used, calculating the baseline against which progress can be measured. Despite its straightforwardness, application, and approach may vary depending on goals, purpose, and scope. Is the footprint measuring an entire company’s operations, or only focusing on one product, or could a company want to understand the plastic footprint of a one-off event? Defining the proper scope and determining which areas of plastic usage are included or excluded at the very beginning of the process is extremely important.

Modeled after its precursor, the carbon footprint, the plastic footprint reflects a similar model—measuring, mitigating, and investing [2]. This topic has gained more attention in recent years, followed by a spike in plastic pacts, agreements, bans, and zero-tolerance statements [3]. Global trends reveal that a growing number of countries are responding to customer demand, requiring more “environmental considerations into their products [4].” Perhaps the spike is fueled by fear, opportunity, or hope. Whatever the reason, the inspiration to act, and be successful, requires a baseline from which to set a foundation. Studying a success story here is meant to guide, educate, and inspire your plastic footprint on the first step on your journey to plastic ESG.

Case Study: Plastic Footprint for a Cosmetic Business

ClimeCo examined the process and corresponding results from conducting a plastic footprint for a cosmetic business whose mission is to provide clean products with ingredient transparency and zero or low waste in its operations. Plastic footprint assessments provide the baseline for action, valuable insight for informed decisions, long-term cost savings, and partnership opportunities across the value chain.

Let’s dive deep into the process of making one of its products: a body lotion. The steps of this exercise were:

Assessing the internal plastic footprint
Designing and defining (where needed) mitigation measures
Enhancing product offering and marketing
Creating opportunities to connect more with customers and/or existing suppliers

Like a carbon footprint assessment, the first step is defining the scope. In this case, ClimeCo looked at the inflow, operational, and outflow of plastic in the company’s value chain.

Inflow plastic is the packaging that enters the company’s operations attached to a product and leaves it as waste. (In this case: ingredient packaging)
Operational plastic, like industrial plastic, is used and disposed of during a company’s operations (In this case: plastic gloves, stirring tools, and storage containers)
Outflow plastic is attached to a product within a company’s operational boundaries and leaves together with the product. (In this case: the primary packaging, outer box, marketing and instructional materials, and decorative add-ons)

After a detailed survey, we clearly defined the picture of the plastic flowing throughout the company’s operations. An assessment of the type and form of plastic packaging and material usage (single use vs. durable) was done, detailing all important data and highlighting hotspots for action. Local waste management and partnership opportunities were included in the data analysis as well. This data built a roadmap with short, mid, and long-term actions.

With zero investment, the company reduced waste sent to landfill from 62% to 30%. Reducing waste to landfill was achieved with immediate, internal changes, such as proper on-site sorting and disposal, leveraging available waste management, and a local recycling center. Improved employee training and adequate labeling of waste bins were also vital in increasing landfill diversion and reducing recycling stream contamination with non-recyclables. Changes to the product packaging were made, reducing the outflow plastic footprint from 64% diversion to zero, as part of a 100% reusable and recyclable packaging program.

Next, the company took the following external steps to mitigate its footprint further while enhancing its relationships with suppliers and customers:

Initiating upstream partnerships with suppliers to return and reuse shipping containers and packaging, reducing inflow packaging.
Offering refill and takeback programs to customers in exchange for discounts and rewards. This is only possible because the product packaging is now durable, washable, and can be sanitized with every use.
Evaluating operation-related and product-related certifications such as waste diversion, plastic-free seals, and recyclability.
Educating customers by adding information on the takeback program, disposal options, certifications, and the plastic footprint to product marketing.
Improving landfill diversion through local haulers and recyclers outreach (new goal is from 30% to less than 10%).
Offsetting the unavoidable plastic by investing in collection & recycling activities through verified plastic credits.

Aside from enhancing product messaging, customer engagement, and reportable ESG metrics for stakeholders, the cosmetic company saw a 10% increase in overall sales and positive customer feedback. Moving forward, plans for this company include expanding the plastic footprint exercise to other products, which is an easy task to implement due to the availability of initial footprint data.

With a quantified baseline and a coherent action plan laid out, the most challenging part of creating a successful plastic ESG plan is complete. The benefits of this plan go beyond reducing pollution. You can now create value that was unattainable before.

The next step requires answering questions such as:

How much money are you saving by making plastic-conscious choices?
What are the new marketing opportunities available?
What is the ROI of changing your operations to be more sustainable?

Part II of this blog will answer these questions. Actions like these will appeal to your senior management, investors, and customers alike. There is a small window available where you can act, stand out from the competition, and be a part of creating the solution. Stay tuned for our next blog, where we outline the data you need to make a case for preventing inaction.

[1] Shelton Group, Waking the Sleeping Giant: What Middle America knows about plastic waste and how they’re taking action
[2] ClimateTrade, The evolution of carbon footprint measurement
[3] Reuters, Big brands call for a global pact to cut plastic production
[4] The Ellen MacArthur Foundation, The rise of single-use plastic packaging avoiders

About the Authors

Leticia Socal is a chemist and seasoned plastic industry professional with over 15 years of experience spanning R&D, intellectual property, market research & strategy. Leticia is a certified TRUE Zero Waste advisor and a Blue Consultant. She holds a Bachelor of Science in Industrial Chemistry, a Master of Science in Materials Engineering, and a Ph.D. in Polymer Science.

Cassian Bellino is a member of ClimeCo’s Voluntary Credit Project Development team, developing the Plastic Program. Her scope of work is verifying and registering plastic collection and recycling projects with global registries and standards, such as Verra and Zero Plastic Ocean. Cassian also supports the marketing and communications of these projects with external parties to educate further and support plastic recovery.

“We cannot change what we are not aware of, and once we are aware, we cannot help but change.” Sheryl Sandberg, Lean In: Women, Work, and the Will to Lead

ClimeCo Responds to the Greenhouse Gas Protocol’s Surveys for Standard and Guidance Updates

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ClimeCo Responds to the Greenhouse Gas Protocol’s Surveys for Standard and Guidance Updates

Our experts weigh in on recommended updates to the global greenhouse gas accounting standard.

by: Garrett Keraga | March 20, 2023

Boyertown, Pennsylvania (March 20, 2023) – In 2023, the Greenhouse Gas Protocol (GHG Protocol) invited stakeholders to recommend updates to its widely-used standards and guidance for measuring greenhouse gas inventories. This presents a rare opportunity to help shape the way that companies report on emissions, track them over time, and use market-based mechanisms to support global decarbonization efforts. The ClimeCo team gathered leaders from around the company with expertise in measuring inventories, developing environmental commodities, and helping companies lower their emissions. We’ve crafted a response to help push the industry forward constructively and mindfully.

In the survey for the Corporate Accounting and Reporting Standard, we indicated a high level of satisfaction with the existing material and provided a range of minor tweaks to improve fidelity. This included suggestions like improved guidance on emission factor databases and leased asset accounting, improved accounting procedures for companies or portfolio managers with high levels of inorganic growth, and a clear recommendation on a baseline recalculation threshold.

Our responses for Scope 2 and Scope 3 similarly indicated satisfaction with the current guidance but suggested several more areas of improvement. Within Scope 2, we requested clearer guidance around renewable energy certificate (REC) boundaries and improved residual mix emission factor availability globally. We did not see a current need for revisions to the REC market that incorporate proof of total change in low-carbon supply. Our Scope 3 suggestions included creation of a remote work emissions category: consistent allocation of upstream versus downstream emissions, additional industry specific guidance for several categories, and guidance around market-based mechanisms within Scope 3.

Our experts had numerous suggestions for the future of market-based accounting, including expanding market-based accounting into Scope 1 and Scope 3 through inset credits, mass-balance certification, and book and claim certificates. We advised the GHG Protocol to establish systems that use the same principles as the current market-based Scope 2 reporting. Our team believes the voluntary market will continue incentivizing fast-paced, cost-effective progress toward net-zero, regardless of physical limitations. The graphic below explains how this system might work with a book and claim approach for a shipping company.

About ClimeCo

ClimeCo is a respected global advisor, transaction facilitator, trader, and developer of environmental commodity market products and related solutions. We specialize in voluntary carbon, regulated carbon, renewable energy credits, plastics credits, and regional criteria pollutant trading programs. Complimenting these programs is a team of professionals skilled in providing sustainability program management solutions and developing and financing of GHG abatement and mitigation systems.

For more information or to discuss how ClimeCo can drive value for your organization, contact us at +1 484.415.0501, info@climeco.com, or through our website climeco.com. Be sure to follow us on LinkedIn, Facebook, Instagram, and Twitter using our handle, @ClimeCo.

The Role of Net-Zero in Corporate Strategy

by: David Prieto | Director, Climate Finance & Strategy | August 25, 2021

The Paris Agreement signed in 2015 ushered in a new era in corporate strategy. This new era is one where companies and investors play a fundamental role in addressing the key issue of our time – climate change. In our lifetime, the corporate sector has increasingly experienced the impact of climate risk – both physical and transitional. High-profile examples include the bankruptcy of PG&E after the 2018 wildfire season in California and the Volkswagen diesel emissions scandal from 2015. Nonetheless, corporate leaders realize that climate change is also the biggest wealth-creating opportunity in human history. It is, therefore, no surprise that investors are rewarding low-carbon business models with record valuations, such as Tesla and Beyond Meat.

In the absence of broad climate policy and regulation, corporate leaders have to navigate a growing landscape of voluntary initiatives designed to address many environmental, social, and governance (ESG) issues, including climate change. The rapid pace of change in ESG can be daunting to navigate for corporate leaders. Therefore, it is important to understand which voluntary initiatives best align with a company´s strategy and business model, from campaigns and commitments to methodologies, registries, and standards. This blog will discuss the latest development in ESG – Net-Zero – and why it plays a fundamental role in any corporate strategy.

The Science Behind Net-Zero

The goal of the Paris Agreement is to limit the rise in mean global temperature by 1.5°C above pre-industrial levels to avoid the most severe impacts of climate change. To succeed, global emissions of greenhouse gases (GHG) need to halve by 2030 and reach net-zero by 2050, according to a landmark study published in 2018 by the Intergovernmental Panel on Climate Change (IPCC). Achieving net-zero emissions will be a monumental challenge – human activities generate 55 GT of carbon dioxide (CO₂) per year, resulting in a total carbon budget of 580 GT of CO₂ before exceeding the 1.5°C threshold.

Establishing a Net-Zero Target

Net-zero is a state in time where corporates meet two conditions, according to the Science Based Targets initiative (SBTi). First, GHG emissions from a corporate value chain are abated at a rate consistent with a 1.5°C pathway. Second, residual emissions that cannot be eliminated for technical and economic reasons are compensated by an equivalent amount of carbon dioxide removals. During the transition to net-zero, a science-based target (SBT) informs whether the current rate of emissions abatement is aligned to a 1.5°C pathway. Establishing a net-zero target (NZT) is a commitment to the deep decarbonization of a business model and the resulting future emissions rate.

Deep decarbonization is complex work that requires a diverse set of policy, legal, technology, and market solutions that remain in development as outlined by various net-zero roadmaps, such as the IEA Net-Zero by 2050 and BNEF New Energy Outlook. Optional compensation measures play a key role during the transition to net-zero by neutralizing unabated emissions as the global economy aligns with climate science.

Graphical representation of a net-zero target, an interim science-based target, and optional
compensation alongside the taxonomy of climate mitigation tactics, Science Based Targets Initiative

Different Pathways to Net-Zero

The journey to net-zero is critical to corporate strategy because it entails a fundamental transformation across all sectors of the global economy for business models to operate in balance with the planet. Unfortunately, not all net-zero transformations are created equal, as the emissions profile of value chains vary significantly by sector. In particular, so-called hard-to-abate sectors, such as plastics and aviation, will take longer to decarbonize in the absence of low-carbon alternatives. Nonetheless, the complexity of business model decarbonization has not deterred the private sector that now has approved science-based targets encompassing 20% of total global market capitalization.

Sustainability Solutions for Net-Zero

Since our founding, ClimeCo has been a leading transformation partner to companies, investors, and governments pursuing a low-carbon future. As a vertically integrated sustainability solutions provider, we have enabled our clients to go beyond business as usual. By developing frontier technology-based and nature-based carbon reduction projects, transacting voluntary and compulsory environmental credits, and advising on climate risk and disclosure, our team is dedicated to implementing decarbonization pathways tailored to our clients’ sector, business model, and balance sheet.

Cypress trees planted at a Climate Forward reforestation project in Louisiana, Restore the Earth Foundation

Commencing the Net-Zero Journey

From carbon neutral to net-zero and climate positive, any corporate climate strategy must follow a mitigation hierarchy. A mitigation hierarchy will inform whether a mitigation strategy effectively neutralizes a company’s impact on the climate, mitigating climate risk on the company, and incentivizing low-carbon capital allocation. At ClimeCo, our team aligns to the Blueprint for Corporate Action on Climate and Nature and recommends four priority interventions:

1. Account for and disclose emissions using internationally recognized frameworks, such as the GHG Protocol, CDP, and Task Force on Climate-related Financial Disclosure (TCFD),
2. Reduce value-chain emissions in line with a science-based target pathway, as defined by the Science Based Targets initiative (SBTi),
3. Quantify a financial commitment by pricing remaining emissions through an internal carbon price, and
4. Invest the financial commitment for impact to climate and nature to further emission reductions, unlock climate solutions, and source high-quality carbon credits.

Net-Zero in a COVID World

The IPCC released the first part of the Sixth Assessment Report (AR6) this month and the science is clear – it is in our hands to limit the rise in global temperatures to 1.5°C. Global emissions must fall 7.6% per year between 2020 and 2030, roughly the same drop in emissions from the COVID-19 lockdowns. As a result, extreme weather and the failure of climate action have continued to dominate the long-term risks by likelihood among members of the World Economic Forum. However, COVID-19 has accelerated stakeholder pressure to transition to a low-carbon growth path that could deliver a direct economic gain of US $26 trillion through 2030, compared to business-as-usual. In his annual letter, BlackRock’s Larry Fink, succinctly points this out: “given how central the energy transition will be to every company’s growth prospects, we are asking companies to disclose a plan for how their business model will be compatible with a net-zero economy – that is, […] how this plan is incorporated into your long-term strategy and reviewed by your board of directors.” For leaders integrating net-zero into their corporate strategy, ClimeCo is ready to help.

About the Author

David Prieto serves as Director for Climate Finance & Strategy at ClimeCo, where he advises clients navigating the risks and opportunities associated with an increasingly changing climate. David holds a Master of Science from Columbia University and Bachelor of Arts from the University of London.

Moving Forward with Net-Zero

by Zach Harmer & Nancy Marshall | February 29, 2020

In late January 2020, the United States House Energy and Commerce Committee released a discussion document on the Climate Leadership and Environmental Action for our Nation’s (“CLEAN”) Future Act, which has the broad sweeping goal of reaching a “100% clean economy by 2050”. It is one of many attempts from the federal government to align goals for creating an economy that achieves carbon neutrality. In contrast to the political inertia we have seen in advancing meaningful climate action in some governments, we have witnessed a number of municipal, sub-national and international governments along with many multinational and local companies increase their commitments towards carbon neutrality. So if we are seeing social, corporate and political trends towards a 100% clean economy, what is the role of legislation if action is already happening? Why are announcements like the CLEAN Future Act still meaningful and needed?

First, let’s start with the question “What does a ‘100% Clean Economy’ really mean?” Everything has a carbon footprint – you have a personal one, your business has one, so does your favorite sports team and coffee shop. If you can find a way to reduce your personal carbon footprint, offset your remaining carbon impact, and/or support external efforts that make that footprint carbon neutral, you can achieve 100% net carbon neutrality.

Beyond these personal actions, we are seeing increasingly more corporate commitment to achieving net-zero emissions – from Microsoft’s decision to become carbon negative by 2030 to Cenovus Energy’s pledge to carbon neutrality by 2050. This growing number of commitments represents a significant shift towards a more carbon-conscious business world. Parallel to these milestone announcements, we have begun to see some governments design the enabling and backstop legislation that sets clear and measurable emission reduction targets and provides a broad range of incentives to encourage citizens and businesses to reach a common goal.

At the individual level, reducing your carbon footprint, such as paying extra for green electricity, can be expensive and may not be an option for everyone. Similarly, reducing emissions at the corporate level reducing emissions may not be as economically and/or technologically feasible from sector to sector or from facility to facility. Therefore, one of the most important considerations for any net-zero legislation is to ensure that there are programs in place to support those areas of the economy most affected by the legislation; this can be achieved by providing extra support in the form of funding for the development and trial of new technologies, or for less stringent emission reduction targets.

The CLEAN Future Act provides just one example of how governments can define, target, and delegate the path to net-zero emissions by 2050. Canada, for example, has recently committed to net-zero emissions by 2050 and is developing an action plan. In addition to Canada, there are more than 70 other countries that have committed to being net-zero by 2050. Though the commitment remains the same, each country will have to develop their own unique strategy to achieve carbon neutrality. More interesting, perhaps, is how these countries may look to harmonize and coordinate their climate ambition to scale meaningful change and progress.

Currently, there is no “one-size-fits-all” solution to achieving net-zero emissions. As we advance into the 2020s, we are likely to see more commitments to net-zero and new innovative approaches to reducing emissions. So, what can you do?

Stay informed – with the actions being taken locally, at the community, state, and federal levels; and
Make your voice heard – during government consultations or through your local representatives.

About the Authors

Zach Harmer is a Policy Analyst at ClimeCo. He lives in Calgary, Alberta, and is an avid outdoor enthusiast. In his spare time, Zach enjoys exploring the Rocky Mountains and cooking for family and friends.

Nancy Marshall is a Corporate Marketing Director at ClimeCo. She is originally from Maryland and currently lives in Houston, Texas. She enjoys boating and fishing on Lake Livingston, cooking, baking (especially at Christmas), and crafting with vinyl.

Glossary

Plastic Footprint Part I: Insights from a Case Study

Plastic Footprint Part I: Insights from a Case Study

ClimeCo Responds to the Greenhouse Gas Protocol’s Surveys for Standard and Guidance Updates

ClimeCo Responds to the Greenhouse Gas Protocol’s Surveys for Standard and Guidance Updates

The Role of Net-Zero in Corporate Strategy

The Role of Net-Zero in Corporate Strategy

Moving Forward with Net-Zero

Moving Forward with Net-Zero

Sources

Additional Resources