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This post continues the discussion on why companies should measure their carbon footprint. This time the focus is on product carbon footprint, measuring the GHG emissions from the “cradle to the grave” throughout the entire lifecycle of the product (goods or services) . This means measuring carbon footprint at each stage of the product’s life, including extraction and production of raw materials; following the transportation of these materials, manufacturing, distribution, and product use. Moreover, measuring also includes the product's reuse, disposal, or recycling (The Carbon Trust, 2022). Furthermore, a product's carbon footprint should consider the entire value chain footprint, which measures the GHG emissions of the raw materials and services purchased by an organisation(s) to deliver its service and/or product (ibid).
Why is it important to measure company's product carbon footprint?
Measuring representative product carbon footprint can bring to company numerous opportunities for GHG emissions reduction but also:
- redesign business model elements to increase its sustainability level, for example, greening operations to optimise resources use (see Stoknes's diagram below, level 4),
- identify new opportunities in developing innovative and greener products/services (level 5),
- understand better the company supply chain carbon impact, and the risks that climate change drastic events might bring to your business in the future,
- reduce company emissions – by replacing current suppliers with more sustainable ones, switching to higher quality materials and consequently designing better products,
- engage with employees, suppliers, investors, and customers to motivate them to reduce emissions in the organisation and to encourage suppliers to do the same
- steer sales on the new markets and attract customers with sustainable values and
- size brand awareness, its value and increase customer brand loyalty.
Per Espen Stoknes, a Norwegian psychologist, economist, climate researcher, and green-tech entrepreneur developed a diagram that visualises a company's step by step actions that it can undertake in its transformation to become more sustainable. Actions can span from external with lover complexity towards internal organisational processes and product portfolio greening with higher complexity and larger sustainability impact for the company. Stoknes placed the greening supply chain, company production operations and product portfolio in the core of company transformation, reinforcing the importance of measuring the product/service carbon footprint affecting the transformation of the business model as having the highest impact on sustainability.
A simplified version of Stoknes' diagram (based on Stoknes, 2021, p. 221).
What to consider before measuring a company's particular product carbon footprint?
According to The Carbon Trust (2022) company, before starting to measure a product's carbon footprint, it has to have clear answers to the following questions:
- Why does a company need and want to measure representative product's carbon footprint?
- What would be an exemplary product to select for carbon footprint evaluations?
- What would be the detail of measuring process: a high-level carbon key points adequacy or detailed analysis done by an external expert?
- Can the process be done internally, or an external expert is required? and finally
- How and to whom will you communicate the results of your product footprint measurements?
Once company has answers to questions the measuring process can start.
How measuring product carbon footprint can be done?
The process of measuring product carbon footprint has the following stages:
1. Define the assessment boundaries, data collection areas and critical stages of the product’s lifecycle, like extraction and production of raw materials, transportation, manufacturing, distribution, product use, disposal, or recycling. For the service lifecycle, should stages be defined for each service individually.
It is recommended that companies also include the value chain footprint, which measures the carbon impacts of the raw materials and services that an organisation purchases to deliver its service(s) and/or product(s).
2. Collect the data at before identified steps of the product lifecycle, including
material inputs, outputs, the process (energy consumption), gas emissions and other environmental impacts. These data should be collected from the suppliers, manufacturers or industry databases. The Carbon Trust (2022) recommend to have at least 70% high quality of data to ensure a product footprint accuracy.
3. Calculate your product emissions for each of the product lifecycle. Using collected data, calculate the emission of GHG, including carbon dioxide (CO2), methane (CH4), and nitrous oxide (N2O).
4. Convert all emissions to a common unit of CO2e (carbon dioxide equivalents) to make comparisons between different gases.
5. Sum the emissions for each product lifecycle stage to identify the total amount.
6. Assess uncertainties by verifying results with another or third party, which is commonly required in sustainability reporting. It is important to know that uncertainties can affect the data accuracy of the carbon footprint calculation.
7. Communicate the results of company calculations to your stakeholders, customers, investors, and local community.
Communicating sustainability-related activities in the organisation is crucial; therefore, future writing will be dedicated to this theme.
Finally, the entire process has no value if identified opportunities for carbon footprint reduction of the company's most representative product are not implemented.
If the organisation has no internal experts, we recommend contacting sustainable consultancy for assistance or a specialised company conducting these measurements.
Email us if you want to know more about how your company can measure product or service carbon footprint or organisational footprint.
Let us know themes you would like to learn more about.
References
- Green House Protocol (2023) Product Life Cycle Accounting and Reporting Standard https://ghgprotocol.org/product-standard
- Stoknes, PE (2021) Tomorrow's Economy: A guide to creating healthy green growth, The MIT Press p. 221
- The Carbon Trust (2022) A guide: Carbon footprinting for businesses, https://www.carbontrust.com/en-eu/our-work-and-impact/guides-reports-and-tools/a-guide-carbon-footprinting-for-businesses
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