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Why companies need to embrace renewable energy in 2020

We are constantly being pummeled by bad climate news. Despite the efforts of individual countries and international organizations, a November 2019 report by the United Nations asserted: “countries collectively failed to stop the growth in global GHG emissions.” This has led to increasing average global temperatures and the unquestionable need for deeper and faster emission cuts.

However, the private sector cannot sit idly by waiting for governments to act – it is time for companies to step up and be leaders in the fight against climate change. In addition, for businesses, research is proving that prioritizing sustainability is beneficial for long-term financial success. In fact, a 2019 survey commissioned by Enel Green Power found that about half of consumers would pay more for sustainably produced products, and this willingness to pay more is even greater among Millennials and parents. Moreover, as Generation Z is entering the workforce, studies are showing a preference for sustainable goods with 62% saying they would rather buy from sustainable brands.

Now that consumers have spoken, how can companies capitalize on the momentum? Each step in the value chain, from sourcing to manufacturing to packaging to waste management, affects the environment. This is why it is critically important for businesses to consider the circularity of their operations. By rethinking consumption models, companies can play their part in tackling the growing environmental challenges such as diminishing resources and climate change.

A key step in achieving circularity and demonstrating your sustainability commitments to consumers is to use renewable energy, which is becoming cheaper, and more readily available. In fact, according to BloombergNEF, renewables are now the cheapest form of new electricity generation for two-thirds of the world’s population.

There are several important factors to keep in mind to implement renewable energy strategy into your organization:

  • What is the timeline for achieving your sustainability and carbon reduction goals? When working with a renewable energy supplier, your timeline is an important consideration in finding the best project and strategy to achieve your goals on time.
  • Where is the bulk of your energy load located? This could be from several primary facilities or a larger footprint of operations. 
  • What are your priorities for selecting a renewable energy partner? For companies that have set global renewable energy goals, it may be important to work with a supplier that has a global footprint and can execute a multi-country strategy.

It is not always possible to power a facility directly with on-site renewable energy, but companies can still invest in renewable energy through an off-site, Corporate Power Purchase Agreement. A PPA is a contract between a buyer (“off-taker”), such as a commercial or industrial company, and a renewable energy supplier that enables the buyer to purchase the renewable energy from a wind or solar project for a pre-agreed price and time period. As the name “off-site” suggests, a renewable power plant can be located in a remote location from the buyer’s production facilities or stores. The power produced can be delivered through the national grid (so-called, Physical PPAs) or channeled into a local spot market with the pure financial settlement of a contract (Virtual PPA).

In both cases, Corporate PPAs support adding new renewable energy to the electricity grid, enabling new wind and solar projects to be built and effectively displacing fossil fuels. They  are not a new phenomenon, with the first deals made about 10 years ago. However, Corporate PPAs have increased in recent years in both size and frequency, with a record capacity of 19.5GW contracted globally in 2019 (+43% vs. 2018).

In addition to the renewable energy, the buyer also receives the associated Energy Attributes Certificates, in Europe known as Guarantees of Origin (GOs). Each certificate represents one megawatt-hour (MWh) of energy produced by a renewable energy supplier and delivered to the power grid. Uniquely numbered and tracked, GOs also represent the environmental benefits of each MWh of renewable energy. Through the GOs received, the buyer is able to demonstrate claims of renewable energy. This ensures that communication and marketing claims around renewable energy use are compliant, whether you are powering your retail operations with solar power or brewing beer with 100% renewable electricity from wind power.

For help navigating this territory, many companies choose to partner with an established energy company, like Enel Green Power, that can help guide them through the process and ensure that the transition to renewable energy happens efficiently and effectively.

For example, in August 2019, Gap Inc. signed a 12-year Virtual PPA with Enel Green Power, which will provide enough energy to power over 1,500 of the company’s global retail stores. With the help of our partnership, Gap Inc. expects to reach its 2020 goal of reducing greenhouse gas emissions by 50% compared to a 2015 baseline.  In addition to Gap Inc., Enel Green Power’s customer portfolio includes Adobe, Anheuser-Busch, Bloomberg, Facebook, General Motors, Kohler, Mondelēz International, T-Mobile, Danone North America, and Wynn Las Vegas. 

Together, final consumers and companies alike can push the industry toward a more sustainable future. With informed decisions and ambitious goals, business can help create a greener planet for everyone, and become a more forward-thinking industry that leads by example.

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How will Sustainability Intelligence influence your CSR activities?

Sustainability management and supply chain engagement is a topic which gains more and more interest in today’s business world. Companies are requesting their suppliers to gain them insights in their supply chain to assess the risk of threats like human rights infractions or ecological scandals.  Assessment platforms like CDP or EcoVadis allow comfortable access for those requesters to the collected data and a check of immediate risk.

Besides that, companies are more and more pressured by stakeholders, customers or newly introduced laws to publish non-financial key performance indicators (like for example their Carbon Footprint or compliance infringements). That reporting is then often done in a CSR-report aligned to one of the global standards. The most widespread of those reporting frameworks are the UN Global Compact and GRI.

Effectively, as most newly requested mid-size businesses are not (yet) having the luxury of an own sustainability manager or even the basic infrastructure to collect all needed data effectively, the practice has shown that a lot of unnecessary extra workload is generated. Luckily, once a certain level of qualitative data is gathered, it can be used for several assessments. There are lots of crosslinks between the different providers. For example, EcoVadis acknowledges a filled-out CDP-questionnaire or a GRI-report and rewards them with several points.

Though, this process can easily be slimmed down to a centralized data collection. This is what we understand as Sustainability Intelligence (see fig. 1).

Fig. 1: DFGE’s Sustainability Intelligence approach (own elaboration)

Current challenges within the sustainability area

The field of CSR management and sustainable business is becoming more complex. Above named aspects are main drivers for this development. Being compliant with social, economic and environmental law regulations is the minimum requirement a company should fulfill. Nevertheless, such behavior is a defensive and reactive strategy and doesn’t provide the needed flexibility dealing with relevant (sustainability) risks. Therefore, it is more useful integrating sustainability aspects into the core business and implementing a proactive sustainability strategy.

In the first step, it is important to perform an analysis of the current sustainability state in order to identify the current status of CSR engagement. The next step is to identify the key aspects and impacts of your business in cooperation with key stakeholders. This will guarantee deriving suitable goals that should be ambitious, but also not unachievable. In order to achieve these objectives, measures must be defined that can be implemented within a certain period of time. The communication of this engagement via a suitable channel (e. g. UNGC, GRI) shows transparency and can be used as a verification tool. This in turn provides a basis for the next analysis of the current state.

Sustainability Intelligence supports your sustainability management

The DFGE supports companies at all stages of their CSR engagement and in implementing a sustainability management which is in line with the Sustainability Intelligence approach.

Regardless of your business activity, the calculation of the Corporate Carbon Footprint (CCF) is an appropriate tool for calculating the climatic impact of a company. The determination of the Product Carbon Footprint (PCF) establishes the conjunction to the core business. The additional calculation of the Water Footprint supplements the overall eco balance and provides a consistent representation of the ecological impact of a company. The challenges of such calculations are the holistic calculation of all relevant areas (e. g. Scope 1, 2 and 3) as well as the consideration of all (global) locations of the organization. The DFGE has an experience of more than 20 years in calculating carbon footprints and eco-balances. By means of DFGE’s TopDown approach, the emissions of the baseline scenario (prior to the implementation of the pilot scheme) could be compared to the emissions afterwards. All calculations are executed in accordance with the principles of the Greenhouse Gas Protocol and the DIN 16258 norm (regulating greenhouse gas emissions in transport and logistics).

Based on the Sustainability Intelligence approach, the existing database can be seriously communicated via a GRI or UNGC sustainability report and can be used as part of a CSR rating like CDP or EcoVadis. This approach applies to other ecological aspects and to social issues as well. DFGE helps your organization in developing appropriate measures and KPIs. This will be implemented in the context of a dynamic CSR engagement in order to ensure the continued development of the company in this important area. The Sustainability Intelligence approach helps to exploit the resulting synergy effects here, too.

Summarized, the aim of DFGE’s Sustainability Intelligence approach is to bundle the effort of taking part in the sustainability business area. This way, work has to be done only once and you can focus on the substantial, meaning on your sustainability management and execution of CSR activities.

DFGE at the Sustainability Leaders conference in Berlin

On May, 23rd and 24th, DFGE will participate as an exhibitor sponsor at the Sustainability Leaders conference in Berlin. This will give you the opportunity to discuss with us current trends, opportunities and reporting frameworks within the CSR area as well as about our Sustainability Intelligence approach. If you have any questions before the Sustainability Leaders conference or in general, don’t hesitate to contact us via info@dfge.de or by phone at 08192-99733-20.

 

About DFGE

Founded in 1999 as a spin-off of the technical University of Munich, the DFGE – Institute for Energy, Ecology and Economy provides consulting services in the field of sustainability. Our offer Sustainability Intelligence featuring calculation management and reporting solutions aims at bundling the effort of taking part in several sustainability/CSR standards and rankings like CDP, UNGC, EcoVadis or GRI. Our services are structured according to our ACCoRD scheme: Analyze, Collect, Compose, Review, and Document, to foster continuous improvement and collect reliable data. Our clients range from international companies (DAX and fortune 500) to SMEs. Our partners are key players in the domain (such as CDP and EcoVadis), and we constantly monitor the current trends and existing norms, to support the organizations with dedicated solutions.

 

The DFGE disclaims all warranties as to the accuracy or completeness of the given information. All opinions and estimates included in this report constitute DFGE’s judgment as of the date of this report and are subject to change without notice. DFGE shall have no liability for errors, omissions, or inadequacies in the information contained herein or for interpretations thereof.

All trademarks and registered trademarks are the property of their respective owners

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Emerging Technology Changing EHS & Sustainability

Author: R Mukund, Gensuite Founder & CEO

What does the future of Environmental, Health, Safety and Sustainability (EHS&S) look like as we enter the world of wearables, artificial intelligence, QR technologies and virtual/augmented reality? Perhaps like a scene from a science fiction film, with tech ranging from smartwatches and glasses, to artificially intelligent personal assistants and beyond–the possibilities are endless!

Gensuite has been exploring these new drivers for human and technological engagement with its subscribers and partners. Our mission is to intelligently integrate and innovate cutting-edge technology into our cloud-based suite applications for compliance and management systems; we are currently engaged in a number of different projects connecting Gensuite applications with emerging technologies, including:

EHS&S Mobile Software
It seems there’s a Mobile app for everything nowadays–including ones that help manage your EHS and Sustainability programs. In recent years, Mobile technology for EHS&S has increased in popularity due to its ability to manage programs on-the-go. Gensuite Mobile allows users to do just that with added capabilities such as offline access, quick action QR coding, upload options for forms & attachments, voice-to-text input & virtual assistant, and dashboards for real-time views & actions. With EHS&S Mobile software technology, you can enhance and integrate your programs with a wide range of compliance & management applications and emerging technologies.1927

Virtual Assistants
For leaders with employees that struggle to adopt new devices and technology at work, imagine providing them a solution that makes tasks like concern reporting or retrieving important information available through simple dialogue. With virtual assistants, all you have to do is ask. Virtual assistants make employee engagement more fluid and less time-intensive, providing a hands-free way for employees to identify safety improvement opportunities and more. With the virtual assistant Gensuite Genny™, you can take your Mobile programs even further by asking questions or statements such as “EHS briefing”.

Beacon Deployment
It’s evident why Mobile usage in the workplace is booming–it adds a new level of vitality, productivity, engagement and accuracy to our day-to-day tasks, and placing EHS & Sustainability management tools in the palm of your hand. When combined with beacon technology, employees could instantly receive information regarding pending actions or critical data as they walk through their site. How does it work? Beacons placed on equipment, workstations, departments or buildings track when user devices are nearby. Users would then be notified through their smartphones or tablets with item or location-specific information, providing real-time data to immediately take action and make informed decisions.

Wearables
While wearable technologies, including fitness watches, smartwatches and glasses, have become commonplace, wearables at work are still fairly new. Even in its infancy, wearable technology at work shows considerable promise for EHS & Sustainability. Forrester Research estimates that by 2018 there will be 2.6 million smart glasses deployed in plants and factories around the globe. This form of wearable technology displays information to users as augmented reality, allowing them to connect and interact with the internet using voice commands, with instant access and visibility to any information. There are a magnitude of applicable uses for this emerging technology. It can be combined with QR code capabilities to present SDS information, LOTO procedures, risk assessments and more, proving useful in a variety of diverse programs.

As a leader in the EHS & Sustainability systems solutions domain, Gensuite offers cloud-based applications to help companies achieve compliance and management excellence. With functionality that spans EHS & Sustainability, QualitySecurityResponsible Sourcing,  Product Stewardship and Asset Management, Gensuite has you covered from research to deployment, maintenance and beyond. We are devoted to pioneering innovations for users in the compliance and management systems software arena, to simplify and enhance programs, processes and performance across operating environments.

Interested in learning more about leveraging emerging technology to transform your EHS & Sustainability programs? Request more information on frontier technology and uncover ways to integrate these technologies in your workplace. You may also submit an inquiry to request a demo of EHS&S software–discover how you can customize and adopt new technology in your workplace to change your programs for the better.

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Driving Sustainability Goals with EHS&S Management Software

By: Ma Joelle Lingat

At the turn of the millennium, the world braced itself for Y2K. At the same time, the United Nations first introduced the Millennium Development Goals (MDGs), 8 global goals set forth to address poverty, disease, lack of shelter, gender equality, education and environmental sustainability, with a deadline to complete these goals by 2015 with worldwide government participation. While the end of the world never came, the United Nations MDGs lived on.

Fast forward 16 years to 2016. As the 2015 deadline came and went, the United Nations ushered in a new set of goals, the Sustainable Development Goals (SDGs), to follow the MDGs set at the beginning of the millennium. The SDGs introduced 17 new, ambitious global goals as an attempt to banish the originally addressed social issues by 2030. In order to achieve this new initiative, agreed upon by the 193 member states that comprise the United Nations, everyone must do their part.

One giant contributing factor to a sustainable world is a sustainable business. A multinational consumer products company headquartered in Europe jumped at the chance to do their part. They sought to implement an Environmental, Health & Safety and Sustainability strategy at their 500+ locations to contribute to achieving the SDGs and to support their own sustainable growth, focus on people, environment, property and respect of law. In order for their company to be in-line with the SDG vision, they would need to clearly define and communicate corporate EH&S and Sustainability performance metrics and ensure consistent reporting across each of their global locations. They would also need a solution that would streamline and standardize the ability to report these metric units at the site, country, region, business unit and company-wide levels, all in order meet and achieve SDG aligned goals.

The company chose to deploy Gensuite for incident management, metrics recording, and reporting and communications across all business sites. Having EH&S and Sustainability software to manage the business is the most efficient way to ensure regulatory compliance, minimize operational risks and liabilities, and bolster company reputation, all while streamlining business management so that contributing to SDGs and complying with associated regulations are achievable. Here’s how Gensuite worked with this publically held company to create a sustainable business:

Establishing a baseline.
In order to optimize performance metrics for goal setting and improving business sustainability, a baseline of site performance must first be established. The company knew it needed one, so they unified a platform to conduct site performance, record resources, and report metrics and ensured their platform was flexible enough to configure with current business processes.
Analyzing, identifying, & improving.

Once a baseline was identified, the company could begin to set enterprise-wide sustainability goals and begin charting their progress. Charting progress allows for year-over-year comparisons and averages, in order to identify problem areas to address, maintaining and improving business sustainability into the future. For this company, it was important to measure “employee hours worked” across each of their locations, which was leveraged to calculate incident frequency and severity rates. This created a robust incident investigation, follow-up and communication process for improvement.

Quality quantification.
It is important to deploy a Sustainability & Energy Management program that not only efficiently quantifies site sustainability metrics, but also measures the quality of sustainability efforts. This is done using site-surveying options to collect qualitative data, such as Key Performance Indicators (KPIs). The Gensuite Digital Cockpit application was customized for the company to provide a visual representation of KPIs measured against established goals, allowing them to easily track and visualize progression. Understanding the importance of both of these performance aspects ensured that the company’s sustainable work was good on paper and in quality.

Open communications & shared success.
Being a large global business, the company needed a way to communicate sustainability initiatives and results across their sites. They needed to establish clear program expectations across the business for data reporting, communications and to set a review schedule. With Gensuite, the company could easily report and communicate across sites using streamlined applications, making analyzing, identifying, and improving communications effortless. This was done across the entire company, with options such as automatic site notifications to share sustainability success.
The results? The company was able to reach their SDG goals and more using EH&S and Sustainability software. They successfully consolidated Corporate EH&S and Sustainability performance metrics at a group, business, country and site levels, with abilities to cross compare and report across specific periods. They also generated 4+ weeks of time savings per year, eliminating time spent on manual data collection and report preparation. Finally, the company reduced the frequency of leadership reporting from a quarterly to monthly basis, providing enhanced employee engagement. In their effort to contribute to global SDGs, this multinational company was able to effectively and efficiently do their part through digitizing their EH&S and Sustainability strategy.
For business, sustainability is certainly important, but even greater than business sustainability is worldwide sustainability. Nobody is above working towards these goals. This world is ours and these goals are collectively ours as well. Governments, businesses, and individuals must do their part to create a more sustainable future for all.

Learn more about how Gensuite builds sustainable businesses in this case study.