Performing even a basic carbon footprint analysis can help businesses understand the impact of their processes in order to move towards sustainable strategies.

With dozens of carbon footprint calculators available online, individuals can quickly and easily assess their basic carbon footprint by entering a few simple numbers. Businesses, however, are typically forced to purchase software or hire an expert, even when they are small and even when only a simple process needs to be evaluated. The problem is that those who are just beginning to adopt environmentally sustainable practices do not typically have team mates who already know how to perform such an analysis manually.

An in-depth analysis is time-consuming and software is recommended for complex processes, but here are some guidelines for a basic analysis to get your business on the right track. Let’s begin by establishing that the carbon footprint of a product or process comprises only a small component of the ecological footprint, focused not on total impact, but on greenhouse gas (GHG) emissions exclusively. Carbon Dioxide (CO₂) is a widely recognized greenhouse gas, but there are others that should be taken into consideration, particularly Methane (CH₄), Nitrous Oxide (N₂O) and perfluorocarbons. The three latter substances can be converted to equivalents of CO₂, referred to as CO₂e and to clarify why equivalent CO₂ calculations are important, consider that over a 100 year period, Nitrous Oxide has 298 times more impact per unit weight than carbon dioxide. Buildings and transportation are primary sources of GHG emissions, but you can calculate product specific emissions as well.

Let’s look at transportation: Diesel produces 12 kg (26.4 lbs) CO₂e/gallon, gasoline produces 10.5 kg (23.1 lbs) CO₂e/gallon, propane produces 8.5 kg (18.7 lbs) CO₂e/gallon and natural gas produces 1.5 kg (3.3 ibs) CO₂e/meter³. If you would like to know how much of the total is derived from CO₂, please refer to the following table:

The best way to get started is by creating a process flowchart. For example, if you are using intermodal transport to get  supplies from A to B, you can chart each stop and calculate the mileage between stops. If you want to be exact, consider the fuel used by mobile cranes at Intermodal Container Transfer Facilities and if you are really dedicated, consider that those facilities also use fuel in operating their facilities (i.e. overhead). Next, you will need to know the fuel economy of your transportation mode. A fully loaded 80,000 lbs semi-truck uses diesel fuel at approximately 4-5 mpg. Rail moves a ton of freight at an average of about 400 mpg. If you load 45,000 lbs (22.5 ton) of freight on a train, you’ll end up with fuel economy of about 17.78 mpg. Now simply apply the emission factors noted above, in the case of rail and truck, those of diesel fuel.

Here’s an example: You have a semi-truck moving 45,000 lbs of freight over 2,000 miles with optimistic fuel economy of 5 mpg. You are calculating equivalent carbon dioxide. Let’s assume your 45,000 lbs consist of 17,000 individual products weighing 2.65 lbs each.

2,000 miles / 5 mpg = 400 gallons
26.4 (factor of CO₂e for diesel per gallon) x 400 = 10,560 lbs of CO₂e
10,560 lbs of CO₂e / 17,000 = 0.62 lbs of CO₂e per individual product

The following graph provides a general comparison of transportation modes and the results should come as no surprise:

If you are wondering why water transport shows higher emissions than rail, remember that these calculations include equivalents and the low-grade bunker fuel used in cargo ships emits significant amounts of nitrous oxide.

Let me reiterate that carbon footprint is only a small compononent in the assessment of overall environmental (and social) impact. Maritime transport offers an excellent example once more. Consider that each year, ocean-faring vessels from overseas discharge enough ballast water in US waters to fill 20,000 Olympic-sized swimming pools. This process introduces invasive species into local waters and causes concerns regarding reproduction of domestic fish and an increase in pathogens that may affect human health. Clearly, if you were to consider water transport, lifecycle assessment would provide a much more accurate picture than carbon footprint alone.

The same basic process we have just applied to transportation also applies to buildings and processes. If you are evaluating energy that is derived from a typical coal powered utility, you’ll need to know that 1 kg coal emits 2.93 kg CO₂, and that the direct CO₂ emissions from coal power are 1.47 kg/kWh, or about 0.407 kg/MJ. For natural gas, you can use the numbers mentioned above. Your utility bills can help you determine your monthly and annual emissions.

The point of this post is to provide you with a very basic overview of carbon footprint analysis, one that will yield more accurate calculations than those we have retrieved from various free online tools for businesses. It is certainly adequate for the assessment of straightforward processes. Feel free to contact me for additional information or to submit suggestions for improvement of this article.

Complex systems in business are nothing new. When Six Sigma and Design for Six Sigma (DFSS) were introduced, many companies adopted the principles of such methodologies into their core strategic framework and implemented them cross-departmentally throughout their organizations. They did so for good reason: it made business sense and positively impacted processes, regulatory compliance, stakeholder satisfaction and ultimately the bottom line. Design for the Environment (DfE) and TQSM can be applied in the same manner with an effect on the triple bottom line, also known as TBL or 3BL, which consists of economical, ecological and social factors.

A range of aspects can facilitate the adoption of sustainability principles, but a few are vital and it is where small businesses encounter their greatest challenges.

• The vision must come from the top. If the executive team is not fully committed, the strategy will not succeed.
• Sustainability is more easily integrated into a flat or organic organizational structure than into a functional structure.
• Effective knowledge management and sharing is an essential component of continued improvement.
• Without metrics, a company will have no starting point to progress from and no way to benchmark its performance against that of competitors. Because metrics in sustainability are neither widely available nor easily established, businesses tend to avoid this step. But many crucial components of sustainability can be measured and it is easier to do so the smaller the business and the fewer the processes.
•  While more companies now establish departments to manage socio-environmental issues, it is important to ensure that sustainability penetrates the entire organization at every level. Processes must be designed to include TQSM, employees must be trained and all stakeholders, internal and external, must be kept informed.
• There has to be a clear understanding of what it means to be a socio-environmentally responsible company and triple bottom line goals must be defined, so that everyone can work towards them.
• Assigning responsibility for sustainable practices to existing employees is neither conducive to a successful sustainability program, nor a healthy work-life balance for the affected employees. As mentioned in the introduction, strategic sustainability planning is a discipline in itself and requires appropriate attention and expertise.

When small business executives approach sustainability as an integral part of their overall practices, it is no more complex than the integration of Quality Management. The most important considerations are that implementation should follow a top-level executive vision, that communication is of the essence and that metrics cannot be circumvented if the strategy is to succeed.

Employee Volunteer Programs provide important benefits for employees, public relations, and the community.

An ample amount of research has confirmed a positive correlation between company-sponsored employee volunteer programs (EVPs) and employee performance. The Corporation for National and Community Service found that over 26% of the adult U.S. population donated in excess of 8 billion hours in volunteer services in 2007. In 2003, one study found that companies with volunteer programs received increased media coverage, enhanced media, and an 8% increase in sales related to community activities, while another determined that employees in EVPs ranked their employers higher as compared to competitors, experienced greater levels of job satisfaction, and displayed increased loyalty, resulting in improved retention rates.

The findings make perfect sense from a psychological perspective, as employees require a sense of purpose to achieve self-actualization. However, incorporating philanthropy into your business strategy is a powerful move on many other levels as well, if done correctly. Here are some points to consider:

• Partnering with a non-government organization (NGO) can be a mutually beneficial move, as NGOs can provide valuable insight regarding your Corporate Social Responsibility (CSR) strategy and execution.
• Your reputation can be positively impacted by partnering with a respected organization.
• Companies with EVPs make for good human interest stories and creative projects will certainly attract press coverage.
• Choosing an NGO that aligns with your core business values is ideal, as joint marketing efforts will generate revenue for both of you.
• Having employees volunteer for your NGO partner will further develop their skills.
• Your employees will be more excited to recommend you as an employer and job seekers will be eager to apply at the recommendation of enthusiastic employees.

There are still some misconceptions about the incompatibility of corporations and NGOs, but as the demand for CSR rises among stakeholders and such coalitions become increasingly popular, more businesses are bound to adopt EVPs as a core CSR and HR strategy. NGOs understand that businesses have to be profitable and businesses realize that NGOs can provide guidance more than ever before. Just look at the partnerships between McDonald’s and Conservation International, Timberland and City Year, or Kraft Foods and Feeding America. And if you can’t find a perfect fit, create your own foundation, like The Home Depot’s KaBOOM!, The LA Times’ Reading by 9 or ABN Amro’s ABN AMRO Foundation. Weaving philanthropy into your business strategy certainly has a financial upside, but more importantly, it is a significant contribution to the work-life balance of your employees and a priceless gift to your community.

Converting intellectual property into a format that is easily accessible and can be shared in real-time is an essential component of knowledge management.

If you’ve ever been a member of a good project management team, chances are that closing the project included a component called “lessons learned”. If you’ve received formal project management or Six Sigma training, you’ll surely remember the emphasis on this particular step in the process as well. Still, “lessons learned” often gets cut short or ignored entirely, as team leaders focus on sign-offs and other formalities, especially if the project went over its planned time limit. The management of knowledge, explicit or tacit, is not just a project management issue, however; it is an issue that most companies either struggle with or simply pay no attention to and it is costing them time, money and strategic advantages.

Knowledge assets are the intellectual properties that companies acquire over time. This includes collections of data, ideas, skills, insights, capabilities, and information. They are contained in policies and guidelines, software, patents, databases, procedures, employees, and technical drawings, among others. Most businesses invest heavily in securing their intellectual property and for good reason; they may be considered the building blocks of the organization after all. And yet, managing and sharing this knowledge internally remains a challenge. Knowledge management is not to be confused with information management. The latter focuses on data, while the former is concerned with information as an organizational asset.

Effective knowledge management requires an understanding of business processes, as well as a system that can capture and organize this understanding with an emphasis on achieving a culture of continuous improvement. This requires extensive collaboration at all levels, encouraged and practiced by upper management, as well as the availability of a framework for knowledge management. Companies that publish Best Practices have such a framework in place and are often recognized as best-in-class.

The American Productivity and Quality Center (APQC) has identified common hurdles to achieving proper knowledge management, including “silo” thinking, a culture that rewards technical expertise over knowledge sharing, lack of inter-departmental communication and lack of communication between facilities, emphasis on explicit knowledge (data, codes etc. contained within certain media formats) over tacit knowledge (content-specific knowledge, “know-how” or experience) and insufficient time allotted for training, learning and sharing purposes.

Knowledge management requires an investment of time, but it saves time when employees can benefit from internally shared knowledge, rather than having to repeatedly acquire it from scratch. Knowledge shared between facilities in various locations can improve overall performance. Internal benchmarking, internal audits and an effective and easily accessible database (such as an Intranet designed for this purpose), in addition to a culture of collaboration that rewards the sharing of information, are all important steps in the adoption of a knowledge management strategy.

Implementing knowledge management makes for a worthwhile project with the potential to elevate your organization to best-in-class. Be sure not to skip over “lessons learned” as you wrap up, though…

A good strategic plan for long-term business sustainability assigns equal value to economic, social and environmental factors.

We’ve heard a lot about greening businesses this year, particularly in light of the Waxman-Markey bill, carbon tax versus cap-and-trade debates, the Smart Grid, and the climate summit this month. A number of companies have taken advantage of the publicity and spent far more effort on communicating their “green strategy” than on following one. While aggravating to customers and frustrating to competitors who end up having to defend their own green efforts against accusations of greenwashing, this is more likely than not a temporary problem.  Business leaders who choose to focus on environmental sustainability alone risk losing their niche when their competitors do the same. A non-toxic product isn’t exactly novel when no one manufactures toxic products.

Seventh Generation, the household products company, expresses an essential strategic message in its core belief, which is that businesses can change other businesses, as well as consumer behavior, by deploying a successful sustainability strategy. Considering that the majority of the world’s largest economic entities are in fact businesses, not countries, this view emphasizes the power of corporations in driving ethical business practices – or unethical ones. Seventh Generation refused to sell its products to Walmart, unless Walmart committed to socio-environmentally sustainable development, a costly move that eventually paid off on many levels, including customer loyalty, company reputation, and integrity. Seventh Generation doesn’t solely rely on the green factor, but rather embraces a systems approach to evaluate what the world needs most and the world needs more than a green product.

If your business is to change anything, it needs to be profitable, which is why economic sustainability is essential. Social sustainability encompasses the treatment of your employees, your local communities and our global community, preferably exceeding the provision of basic human rights on all levels. Environmental sustainability addresses resources, waste, air and water quality; in short, it ensures the continuous functioning and even thriving of our eco-system. These are equally important components of your overall strategy. They rely on one another for long-term success within any ethical organization.

You must wonder why all companies are not operating according to such a long-term sustainable strategy and the explanation has various facets. Many companies are still not willing to assign the same value to social and environmental factors as they do to profitability. Others may lack the visionary leadership, the cross-departmental communication, solid metrics, alignment of values and processes, employee cooperation, quality control or a good strategic plan all together. While leadership issues are difficult, if not impossible, to resolve, all others can be addressed and improved to achieve a corporate vision and strategic direction that includes each factor – economic, social and environmental – equally. Any company that succeeds utilizing these principles will undoubtedly influence the inner workings of its competitors and customers, and making that impact a positive one should be the ultimate goal of any ethical corporation.

Global warming is most certainly not our only problem, although it may be the focus of mainstream media outlets and the center of publicized political discussions concerning the environment. We have to break the habit of considering components of problems and rather look at a problem in its entirety. Peter Senge uses an interesting analogy in The Fifth Discipline. To paraphrase, we break a mirror to examine its components and when we glue it back together, expect to get the same image we got before we broke it.  We cannot break down socio-environmental issues in this manner. We cannot effectively prioritize clean air, clean water, usable soil, preservation of forests, habitats and species, decontamination of toxic build-up, sustainable food production systems and biodiversity. Separating social from environmental problems is also a mistake, because we cannot possibly expect environmental stewardship from someone whose basic needs for food, shelter and security have not been met. We live in a single eco-system, not in individual bio-domes.

It is tiring to hear the quarrels over global warming, discouraging to see violations of the scientific method for personal or political gain, disillusioning to see failures like the Kyoto Protocol and the UN Climate Conference and disheartening to witness political division to the point of paralysis. None of this, however, takes away from our individual ability or responsibility to influence innovation and change. It is precisely in light of mounting political failures and media quarrels that we have to become the driving force of socio-environmental progress. This appeal applies particularly to businesses, which have the capacity to fuel competition in innovative systems and technologies and model ethical practices. Business leaders often underestimate the degree to which they can influence their stakeholders, including entire communities, although it should become quite obvious when focus shifts from profits alone to planet, people and profits.

Let’s not look to our neighbors, competitors or politicians to drive change.  Perhaps they will, perhaps not. Instead, let’s consider practical, relevant solutions we can implement now, as consumers who drive demand, as employees who influence corporate culture, as members of communities who shape municipalities, as business leaders who drive change and as human beings, who can inspire one another in the pursuit of a common goal.

The Lotus Leaf is a stunning example of adaptation and served as the inspiration for a new surface coating that allows buildings to self-clean.

In a previous post, we had alluded to the environmentally sustainable ideal of systems thinking versus the reality of linear thinking, particularly in manufacturing processes, and promised to provide examples of each to better explain these concepts.

Systems thinking has multiple applications, from problem-solving to enterprise philosophy, but it is most evidently contained within our existing ecosystem.  The concept is simply based on the holistic view that the components of a system are best understood in context to each other and their environment. Although our ecosystem was readily available for copying at the start of the industrial revolution, we chose to go with linear thinking instead, where one step follows another in a cradle-to-grave approach, if you will. Today, 150 years later, we have realized that this is not an indefinitely sustainable production strategy and are consequently evaluating concepts like cradle-to-cradle and biomimicry.

There are millions of products designed by linear thinking. Any single item that faces an end-of-life stage at which it has no further use falls into this category. Look around your home or office and you will see them, from sofas and rugs to computers and televisions, even the materials that comprise the building itself, to name just a few. Do you have a gadget on your desk that consists of several materials fused together, maybe a picture frame or business card holder? Most lamps consist of multiple materials, too, as do most shoes. All these items are bound to end up in landfills one day, because they cannot be broken down into useful materials.

Although cradle-to-grave products are abundant, there are good examples of products or systems that were designed from a holistic perspective. Industrial parks, which reuse waste for energy, or self-sufficient communities model the concept. This year, our company sent out Christmas cards that have been designed to be recycled into carpet backing, so that neither the card nor the envelope has to be discarded. Interface is developing eco-carpeting and other flooring solutions that follow systems thinking. William McDonough’s book “Cradle-to-Cradle” was printed on reusable material, rather than paper, with ink that can be washed off and reused as well. gDiapers makes compostable baby diapers, Pangea’s soaps are packaged in compostable material with the added bonus of built-in seeds. Some of these products need to be refined, but they are certainly moving into the right direction. Their designers created them with the consideration of how they can be absorbed back into the manufacturing or eco-cycle, not in a down-graded state, as recycled paper or plastic, for example, but as intact materials that contribute value indefinitely.

It is impossible to argue the superiority of systems thinking over linear thinking in long-term sustainability and the single most important driver is innovative design. We have looked at production from a similar angle for generations and are in dyer need of creativity. Scientists are taking a closer look at the composition of our natural environment to mimic what comes so easily to nature. From underwater adhesives and no-heat ceramics to self-cleaning mechanisms and silk with tensile strength exceeding that of steel, we are looking to blue mussels, seashells, lotus leafs and spiders to help us create better production processes and more durable, non-toxic products. What better guide than a system that has survived and thrived for over 4 billion years before we came along?

Optimization of the indoor environment can drastically improve employee health and productivity.

Common sense tells us that indoor environmental quality issues come at a cost, but how high a cost exactly is difficult to determine when we attempt to estimate intangible losses. Nevertheless, in an era of emerging green building standards and increased knowledge and awareness of air quality related illness, estimates are becoming available and we are beginning to grasp the full impact of indoor conditions on our corporate budgets.

A study by Fisk and Rosenfeld, initially conducted in 1998 and updated in 2002 places the cost of indoor air quality issues at $100 billion annually and estimates potential productivity gains from improvements to the indoor environment at anywhere from $37-$318 billion. The U.S. EPA estimates that the we spend in excess of $140 billion in direct medical costs attributable to indoor air quality problems and a study by Greg Kats of Capital E indicates that a LEED-certified Silver building yields 20-year health and productivity savings of $36.89 per square foot, while a LEED-certified Gold or Platinum building saves $55.33 per square foot.

Indoor environmental issues are most often associated with toxic particulates in the air and the resulting sick building or tight building syndrome, but it encompasses, in fact, everything from ventilation and noise transmission to lighting quality and thermal conditions. Diseases related to indoor environmental problems include everything from Multiple Chemical Sensitivity (MCS), Pontiac Fever and allergic reactions to asthma, Legionnaire’s Disease and radon poisoning, the second leading cause of lung cancer in the US.

Green building programs, including the USGBC’s LEED certification and Green Globes stipulate clearly for the use of low or no VOC  materials, proper ventilation, an IAQ management plan, acoustic and thermal comfort and even lighting design. Whether or not your company is pursuing a green building certification, material toxicity should be considered in purchasing decisions and optimization of airflow, occupant controlled thermal conditions, and pollutant control must be prioritized to ensure the health and comfort of your most important asset: your employees.

Relevancy and transparency are critical components in communicating corporate socio-environmental programs and objectives.

Most companies recognize environmentally sustainable practices as a competitive edge and market them accordingly. Others are keeping their efforts under wraps, perhaps because they were green before it became a trend or possibly because it is in the nature of their business. Finally, there are those who simply market their intentions of being environmentally responsible. One day. Maybe.

 When should you communicate eco-friendly efforts? Quite simply, whenever they are relevant and genuine. Sustainability in the corporate environment is still considered to be an emerging trend and consumers rely on what little information has been publicized, so don’t frustrate your market by withholding pertinent facts. At the same time, it is not advisable to market illegitimate or indistinct claims. I recently read about the sustainability program of a major hotel group on its website, but when I visited the hotel, I was astounded by the dishonesty of their statements as the toilets seemed to flush incessantly, thermal control was non-existent, as patrons wrapped themselves in sweaters on an eighty degree Florida day, recycling containers were nowhere to be found, virgin paper products were used throughout the facility, lights were left on in areas brightly lit by the sun and the list goes on and on. From an ethical perspective, this is absolutely unacceptable. The message you convey must align with the manner in which you practice it. (Please see yesterday’s post on greenwashing for more on this subject.)

Your audience should consist of all stakeholders, though the degree of detail may vary. Your workforce plays a significant role in communicating with suppliers and clients and should therefore be well informed. Stockholders ought to know about socio-environmental programs as they pertain to earnings and company reputation, while the community should understand your impact and goals. Suppliers must be made aware of requirements and policies, in order to adhere. Structuring the message to encompass the interests of each group is an essential component of effective communication, avoiding both overload and misunderstandings.

Internally, communication channels may include e-mail, memos or face-to-face meetings. Workshops and seminars can be utilized to generate enthusiasm and promote team work. Consumers have been found to prefer third party ratings, the news and company websites to obtain sustainability information. If you are marketing a product, eco-friendly messages on packaging have been proven critical to point-of-sale persuasion. If the resolution of socio-environmental challenges is part of your business philosophy, its promotion should be similar to that of other values, such as integrity, quality or service.

Finally, transparency is, in fact, the best policy. Acknowledging and pragmatically addressing your limitations, rather than trying to conceal them, conveys maturity and realism and demonstrates a proactive attitude to stakeholders. Had the aforementioned hotel chain illustrated their efforts as a work in progress, I would obviously not have been so disillusioned by the enormous amounts of water wasted away in their restrooms, knowing that change was underway, as is my detailed report and expression of disdain to said hotel group’s director.