A Case for Carbon Accountability
By Cindy Waxer
Peter Dering prides himself on being a problem-solver. He recalls that while back-country skiing in Yosemite National Park in 2010, reaching into his backpack and pulling out a camera every time he wanted to take a photo was a “real pain.”
“So,” he says, “I quit my job and spent the next 15 months developing a clip that could easily and securely clamp onto a backpack and hold my phone – with no prior design experience whatsoever.”
Once he developed a prototype, Dering posted his idea for the innovative device on the popular crowdfunding site Kickstarter. In less than three months, the campaign raised nearly $365,000, which he used to source raw materials, manufacture his innovative clip system, and eventually build an $85 million business, Peak Design.
Today, his company designs and manufactures more than 100 products, including rugged travel backpacks and tripods with built-in mobile compatibility.
During a 2017 visit to one of Peak Design’s factories in Vietnam, Dering realized his company was “officially part of the problem” when it came to sustainable business practices and climate change. He learned that many of the company’s products require “an astonishing amount of material to manufacture.” Chief among these materials is aluminum – the second-most used metal in the world after iron ore. Aluminum generates 1.1 billion tons of CO2 emissions per year, accounting for roughly 2% of global human-caused emissions, according to the World Economic Forum. Worse yet, the demand for aluminum is expected to increase by 50 to 80% by 2050.
In response, Dering began exploring the concept of carbon offsets, which allow organizations to put money toward carbon emission reduction programs – such as solar farms or reforestation – to counteract their own carbon emissions. The purchase and sale of carbon offsets takes place in a voluntary market that brings together buyers and project developers from around the world. Within the voluntary market, The Gold Standard and Verra Carbon Standard are among a number of third-party overseers that operate registries listing carbon credits.
Intrigued by the ability of carbon offsets to help organizations take immediate action on their carbon mitigation goals, Dering worked with co-founders Jonathan Cedar and Austin Whitman to launch Climate Neutral, a nonprofit that helps organizations calculate and offset their carbon footprints. Calculations are based on emissions related to all products, services, and business activities, including the fossil fuels and electricity used at a facility and business travel and waste from operations. Climate Neutral clients are required to create a Reduction Action Plan that charts their progress toward reducing emissions and to compensate for all emissions with investments in carbon credits. Once an organization meets these requirements and completes Climate Neutral’s certification process, it can use the Climate Neutral Certified label for a one-year certification period (see sidebar).
Alicia Rodriguez can attest to the growing interest in offsetting carbon emissions. As an account manager at Climate Neutral, she plays a crucial role in manifesting Dering’s vision of a climate-neutral future. Both Dering’s mission and Rodriguez’s dedication are featured in filmmaker Dominic Gill’s documentary Billets and Blooms, a featured selection in SAP’s Road to Regeneration film series, which is produced in partnership with Hot Docs.
SAP Insights talked to Dering and Rodriguez about the challenges and opportunities in creating a climate-neutral world.
SAP Insights: There are many ways to combat climate change. Why approach the issue through companies’ carbon offsets with the launch of Climate Neutral?
Dering: It was the beauty of a carbon offset mechanism that sowed the seeds for creating Climate Neutral. Before I began it, I thought, “What the hell? Climate change is this big, hairy, thorny issue. There exists a way to offset carbon emissions. Why isn’t every company in the world plowing money into these carbon offset markets?” That kind of observation led me to look around for companies that were keenly interested in buying large quantities of offsets.
Rodriguez: For me, the decision to join Climate Neutral was personal. As a native of Puerto Rico, I’ve lived with hurricanes my whole life. But when Hurricane Maria hit in 2017, no one around me really seemed to care. That was a wake-up call for me to pivot my career and work in sustainability to address climate change, which eventually brought me to Climate Neutral.
– Peter Dering, Co-Founder of Climate Neutral
What is the significance of a company committing to carbon offsets by working with your organization?
Dering: We make sure that companies measure their carbon and have credible reduction plans each year on how they plan to reduce the amount of carbon that they utilize. We hold their feet to the fire to make sure they buy enough verified, high-quality offsets to offset their entire carbon footprint. When companies do that, they get to put our logo on their products and say they are certified Climate Neutral.
Rodriguez: Our whole goal is to partner with a brand to help them reduce emissions. But reducing emissions can take many years to complete, depending on how big their operation is. So while those plans are waiting to take effect, we ask brands to compensate by offsetting their footprints and purchasing high-quality projects that meet our standards, such as protecting the health of mangroves in coastal areas or investing in solar farms.
The U.S. Energy Information Administration estimates that in 2019, the world emitted 33,621.5 million metric tons of energy-related carbon dioxide. Are there really enough offsets to impact the world’s carbon footprint?
Dering: There aren’t enough offsets to completely solve the issue right now, but that doesn’t necessarily mean there won’t be in the future. I fully acknowledge that offsets are not a perfect mechanism, but they do accomplish a near-term goal: instead of making a promise to reduce emissions by 2035, carbon offsets ensure that organizations pay for their emissions right now. Paying a price can also financially motivate companies to switch to more sustainable materials, such as recycled aluminum, which has the double effect of encouraging organizations to take immediate action.
– Alicia Rodriguez, Account Manager at Climate Neutral
What are the barriers to convincing brands to become Climate Neutral-certified?
Rodriguez: All companies know they must act on carbon reduction, but there are many challenges. There are so many ways you can approach carbon reduction that it can be very overwhelming – that’s why many companies don’t know where to begin to tackle the problem. Our approach is to help companies develop an understanding of the emissions they’re generating and get started on decarbonizing. Our aim is to weed through all the noise and help our brands identify reduction strategies, work toward implementing them, and find ways to compensate for their emissions in the meantime by purchasing high-quality carbon credits.
Dering: The integrity of the label is all we’ve got. As an asset of our nonprofit organization, the only thing we have that’s worth a damn is the integrity of that label. The garnering of that trust is a 365-day-a-year effort, which means having a committee of scientists that regularly weigh in on the validity of our claims. In fact, third parties that don’t necessarily have a favorable opinion of carbon offsets are part of the committee that make up our verification group. In the end, we believe it’s more important to pursue integrity than growth of our certification label.
What does the future hold for Peak Design and other brands eager to take corporate climate action?
Dering: Peak Design’s plan is to switch over entirely to recycled aluminum, which has a footprint that’s only 20% of virgin aluminum’s [footprint]. We’re also looking for electricity to come from clean resources, such as wind and sunlight, but progress in this area depends on countries building electrical and renewable infrastructure.
Rodriguez: We are in a decisive decade. We have a limited window of time to limit global warming to 1.5 degrees Celsius to avoid the most detrimental effects of climate change. Consumers are ready and willing to make changes, and they’re asking companies to act now. The only thing that has to happen next is for more companies to move forward and act to permanently reduce their carbon emissions.
Designed for businesses of all types and sizes, Climate Neutral’s certification program can take an organization three to four months to complete. Here’s an overview of how the process works:
Step 1: Measure
Climate Neutral works with companies to measure emissions and assess the carbon impacts of all of their products and services, from design to delivery.
Step 2: Reduce
Develop and implement reduction action plans to reduce emissions over the next 12-24 months. Progress towards emissions reductions is documented annually.
Step 3: Compensate
Compensate for all of last year’s emissions by purchasing verified carbon and clean energy credits to avoid and/or remove an equivalent amount.
When complete, a company receives a certification from the Carbon Neutral organization. It joins a list of other certified brands and can display a Carbon Neutral label on all its products and packages for one year.
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