Why you should calculate your company's footprint and how you can make money with it
Calculating a footprint is becoming more relevant every day. For individuals, but especially for companies. The Paris Climate Agreement states that we must reduce CO2 emissions before 2030. The CO2 tax is a fact in more and more countries and regions. In the Netherlands, too, there will be a CO2 tax from 2025 and it seems that measures will be taken for more and more sectors and companies.
To comply with these measures, a footprint calculation is a step in the right direction. In this article, we therefore summarize the main reasons for having your company's footprint calculated now.
1 Ahead of government obligations
As we already emphasized, mapping CO2 emissions for companies is becoming more relevant every day. To encourage companies to emit less CO2 in their production process, there has been a national levy on CO2 emissions in the industry since 1 January 2021. This CO2 levy obliges industrial companies to pay tax per tonne of CO2 they emit. This amount increases annually to encourage companies to take real CO2-saving measures now.
In addition, companies in the Netherlands with more than 100 employees will be obliged from 2023 to report the CO2 emissions of employees' business travel and commuting. If the emissions are too high, actions must be taken to reduce them.
It seems only a matter of time before all companies have to deal with the obligation to keep track of CO2 emissions and reduce them. Calculate your footprint now so that you can start making it more sustainable, and be prepared for the possible levy. A good start is half the work!
2. A footprint calculation is the starting point for awareness and sustainability
Becoming more sustainable starts with awareness. Becoming aware of how sustainable you are as a company, and what impact your business activities have on the environment. This is exactly what a footprint means: it is the impact you, as an individual or as a company, have on the environment through the emissions you generate, both directly and indirectly.
Calculating a footprint gives sustainability a number. This gives you insight into how sustainable your company and products are. Without this insight and awareness in a company, it is harder to take direct steps towards an environmentally friendly company.
In short: in order to become more sustainable, it is important that you know where you stand as a company. The first footprint calculation of a company is the starting point for the reduction of CO2-emissions.
3. Respond to demand from partners and customers
You may have already experienced it: a partner company, customer or purchaser would like to know the CO2 footprint of the product you supply. Your footprint influences the footprint of your chain partners. But how exactly?
Scopes are used when calculating the footprint of your company. These scopes indicate how directly your company is responsible for the emissions. You can read more about the different scopes in this article.
In each scope, your company is responsible for a certain amount of emissions. If the emissions from the production of your product are very high, this will have a negative impact on the footprint of your chain partner. In this case, you shouldn't be surprised if your customer chooses to work with another, more sustainable supplier or partner.
Having a (up-to-date) footprint calculation indicates that you are consciously working on sustainability. If you can share your footprint with your chain partners, this radiates transparency and awareness. You are able to show that you are taking steps to become more sustainable.
4. Respond to the demand from investors
Investors are increasingly looking at companies' sustainability reporting. They then use this to make investment choices.
CSRD and investors
Large companies will be required to report on sustainability from 2025. In 2026, this also applies to listed SMEs. The European Commission has drawn up guidelines for mandatory sustainability reporting: the Corporate Sustainability Reporting Directive (CSRD). The aim of this guideline is, among other things, to move investors more towards sustainable investments in order to achieve sustainable growth.
For more and more companies, this means that they must have a sustainability strategy. We recommend starting with this now so that you are prepared once it becomes mandatory for your business. A footprint calculation can be part of your CSRD. A footprint calculation provides useful insights to implement in your sustainability strategy.
With an up-to-date footprint calculation you show investors that you care about the environment and the sustainable growth of your company. This increases the chance that the investor chooses your company over a company that is not concerned with sustainability.
5. Consumers are increasingly aware of sustainability
Not only companies, but also consumers become increasingly aware of sustainability. Research in July 2021 found that almost half of consumers think it's important that companies take action for the environment (48%) and that sustainability is part of a company's values (42%).
Here also applies: the more transparent you communicate about your sustainability efforts, the greater the chance that the consumer will be willing to purchase your product. A footprint calculation helps with this.
6. Calculating a footprint for long term cost savings
A sustainable company is ready for the future. Of course because of the environment, but also because of the growth opportunities available.
Calculating a footprint is a small investment in the short term, but it can save costs in the longer term. The calculation gives you precise insight into which business activities or products have the greatest impact on the environment. Perhaps the calculation shows that emissions from energy usage are high, so it is a consideration to start using solar panels. By tackling these 'hotspots' and repeating the footprint calculation annually, it is possible to check how well the sustainability efforts are working. This not only saves CO2 emissions, but ultimately also saves on the bill. A footprint calculation also makes it easy to do scenario calculations if you are faced with a sustainable investment. This gives you direct insight into the impact a certain investment will have on your footprint.
Do not forget to include the sustainability topics in the annual report. Being transparent about your climate impact and tackling this, offers opportunities in the market.
Sustainability can already be achieved in small steps in the right direction. Think of green energy, a bicycle plan or less residual waste. You don't have to make your entire production process more sustainable at once. But before you start devising saving measures for your company, it is necessary to know how much is emitted per business activity. Calculating your footprint is a good first step.