Why Businesses Should Cut Carbon

Surprisingly, it doesn't have anything to do with climate change, says Andrew Winston

By Andrew Winston

Posted on Green Advantage: December 11, 2009 8:42 AM

The big global meeting going on in Copenhagen (called COP15) is all about reducing carbon emissions in order to combat climate change. But is climate change the only reason your business should reduce energy use and carbon emissions? Hardly.

But first, let's get out of the way the "scandal" about hacked emails from climate scientists, a story which threatens to overshadow the conference in the media.

I'll be clear and say that many of the most respected scientific communities in the world have come out with strong statements that say the following: nothing in the emails truly undermines the vast, overwhelming evidence from a huge range of sources that the Earth is warming and humans are causing it. See the American Association for the Advancement of Science (AAAS), the American Meteorological Society, the Intergovernmental Panel on Climate Change, NASA, and Nature magazine.

But for business, the science of climate change doesn't matter as much as many want you to believe. Because while climate change and the outcome of Copenhagen are vitally important to society and may change business as usual dramatically, there are actually many non-climate-change reasons why your company should seek to reduce carbon emissions. In other words, you should be doing this stuff already—Copenhagen treaty, email scandals, or no. Because by reducing carbon emissions, you can:

1. Save money now. Energy costs money. Leaner, more efficient companies and countries are more profitable. Companies are finding amazing, head-slappingly easy ways to cut back in areas like facilities (heating/cooling, lighting), fleet, and IT...all with paybacks in terms of months not years (there's more on this in my book Green Recovery).

2. Save money later. One of the beefs with "going green" is that some of the high profile actions, particularly using renewable energy, cost more money (not the initiatives I mentioned above—those save money fast). But on the macro level, consider this...renewable energy is a business model with effectively zero variable cost—your feedstock is free. While the payback periods in some regions seem long, they do pay back, and then your operating costs are permanently lower.

3. Reduce risk. The availability of resources such as water and oil is a serious concern. As demand grows in the developing world, supply will not easily keep pace. Expect expensive, unpredictable, oil prices in particular. So why have your value chain depend on volatilely-priced resources?

4. Answer pressing customer questions. If anyone thinks the "greening of the supply chain" movement is slowing down, they're kidding themselves.

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