U.S. Corporations Size Up Their Carbon Footprints

Coca-Cola, Cisco, Intuit, and others use ever more sophisticated tools to measure their environmental impact and meet emissions goals

By Rachael King

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Like many companies, Coca-Cola (KO) wants to cut its carbon footprint. The soft-drink maker has pledged to eliminate 2 million tons of CO₂ emissions from its manufacturing operations by 2015. To do that, Coca-Cola has become adept at using spreadsheets and databases to measure how much carbon it produces and energy it consumes. It's even able to track less tangible causes, such as greenhouse gases emitted by vending machines. But when it comes to tracking and managing the projects that will help it reduce carbon emissions and make better use of resources, Coca-Cola is having a harder time.

The company needed a more sophisticated set of carbon accounting and management tools, says Bryan Jacob, director of energy management and climate protection at Coca-Cola. "I'm looking for something to take us to the next level," he says. "I'm going to either enhance what I've got or move to a different platform that's much more robust." To that end, the company is testing a product from software company Hara that goes beyond simply measuring carbon footprints. The Web-delivered tools, formally introduced June 1, help companies manage efforts to actually reduce carbon and more efficiently use natural resources such as water, waste, and paper.

Amid growing pressure from investors, employees, and environmental watchdogs such as Greenpeace, the circle of companies making a concerted effort to go green is widening. But corporations are finding that even in cases where there's a will to reduce emissions, it's not easy to measure a company's environmental impact, much less keep track of the various projects aimed at meeting aggressive carbon reduction targets.

The Carbon Disclosure Project

The go-green impetus has spawned a cottage industry of vendors specializing in software specifically to measure, track, and manage carbon emissions. About 50 companies now target this market, says Paul Baier, vice-president for consulting at Groom Energy Solutions, which specializes in technology that helps corporations become more energy-efficient. In a report due to be published June 2, Baier identified seven emerging leaders in enterprise carbon accounting. Among them: Clear Standards, Enviance, Environmental Support Solutions, and IHS (IHS). Vendors were ranked by financial stability, number of customers, and the overall strength of their products. Newcomers are quickly entering the market and Baier says there could be as many as 80 or 90 vendors by yearend.

Demand for better carbon accounting comes not just from corporate brass, but also from investors, customers, consumers, and employees who want detailed information about a corporation's environmental impact. Among the leaders of the charge is the Carbon Disclosure Project, a nonprofit organization that has assembled the largest corporate greenhouse gas emissions database in the world. The group is backed by 475 institutional investors that manage $55 trillion in assets. Last year, 321 companies that make up 64% of the corporations listed in the Standard & Poor's 500-stock index responded to a request for emissions information from the Carbon Disclosure Project, up from 235 in 2006.

To hand over data on emissions, a company must first gather it. Most still use fairly rudimentary homegrown methods. "About 90% of companies use spreadsheets," says Baier. A December 2008 worldwide survey by research firm Gartner (IT) found that too many enterprises were in denial about the need for carbon management.

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