More than 60 companies have completed the road testing of new global standards designed to help measure the greenhouse gas (GHG) emissions of their products and supply chains.
Developed by the World Resources Institute (WRI) and the World Business Council for Sustainable Development (WBCSD), the two new GHG Protocol standards--the Product Lifecycle Accounting and Reporting Standard and the Scope 3 (Corporate Value Chain) Accounting and Reporting Standard--provide methods to account for emissions associated with individual products across their life-cycles and of corporations across their value chains.
The 62 companies from multiple sectors and 17 countries started road testing the standards in January. In June, they submitted written feedback on their usability along with final GHG inventory reports. A summary of the feedback is posted on the GHG Protocol website.
“The road testing experience illustrates how developing rules around measurement, reporting, and verification involves complex technical and policy decisions that need real-world feedback to ensure the right balance is achieved between rigor and ease of use while keeping in view the capacity of both experienced and new users,” said Jennifer Morgan, director of WRI’s Climate and Energy Program. “The GHG Protocol approach to develop international standards provides us a model on how we might want to pursue the development of rules on tracking emissions at the country-level as well.”
The companies that road tested the Product Life Cycle Accounting and Reporting Standard reported they had little difficulty completing an inventory in conformance with the requirements and found the guidance provided in the draft helpful.
“We’re really looking forward to having a standard that can be used globally, for communication across a broad range of stakeholders,” said Robert ter Kuile, senior manager of energy and climate change at PepsiCo (NYSE: PEP). “Road testing the Product Life Cycle Standard has enabled us to engage with other multinational organizations and to join in conversations with NGOs, governments, and academic institutions. When you bring these organizations together, to write a standard, that is going to be the standard that everybody follows and PepsiCo wanted to make sure that we not only learned from the process, but that we also had the opportunity to contribute.”
The companies that road tested the Scope 3 Accounting and Reporting Standard found it achievable to complete a Scope 3 inventory and many companies believe it practical to complete one on an annual basis.
“Road testing the Scope 3 Standard has been a helpful process that has allowed us to assess emissions throughout the entire value chain, and to identify areas that require more attention,” said Katie Wallace, sustainability specialist at New Belgium Brewing Company. “We plan to use the results to drive improvements and measure greenhouse gas reductions associated with New Belgium Beer. Because we believe transparency to be a key ingredient in any authentic sustainability effort, New Belgium will share our findings with our customers, coworkers and stakeholders. This process has taken us one step closer to true environmental stewardship.”
The road testers shared similar views on the business value of using the standards. Most road testers agree that the standards help in identifying GHG reduction opportunities and prioritizing reduction efforts; engaging suppliers and enabling supply chain GHG management; understanding risks and opportunities associated with emissions in the supply chain; creating competitive advantage and product differentiation; and improving credibility and transparency in GHG reporting.
The next steps will be to revise the standards based on feedback from the Road Testers as well as the Steering Committee and Technical Working Groups. The revised standards will be released at the end of September for a 30 day public comment period. The text will be finalized at the end of 2010 and the final versions will be published by March 2011.
Some of the companies that participated in the road testing exercise include: 3M (NYSE: MMM), Alcoa (NYSE: AA), Autodesk (Nasdaq: ADSK), Bloomberg LP, Ford Motor Company (NYSE: F), Herman Miller, Inc, and Pfizer (NYSE: PFE).