Unraveling the complex catalog of climate solutions can be an arduous task. It is often difficult to discern which initiatives will create the most positive impact as they are generally unique to each company.
Why is this the case? Well, for one thing, companies must first understand the make and model of the problem. Every company has unique pain points and supply chain hotspots.
Many companies, notably those in consumer-facing sectors, experience their highest carbon and plastic emissions from their supply chain rather than their operations.
However, once companies achieve supply chain transparency, they still need to design a strategy that is optimized for the environment and their bottom line.
Now your company may be thinking: “Why don’t we just purchase offsets to balance our carbon and plastic footprints and call it a day?” It comes down to the unfortunate truth that we are not going to offset our way out of the climate crisis. Instead, we need companies committing to systematic change and decision-makers who measure what ought to be managed. Nothing will change if we don’t turn off the tap at the source.
Fortunately, the barriers toward initiating climate solutions may be easier to overcome than imagined. But, in order to truly implement the best practices, companies need to be willing to commit to a theory of change that prioritizes upstream solutions.
Upstream Climate Solutions
There are three main considerations companies should consider when implementing a concrete sustainability strategy of climate solutions.
The first is simple, companies should acknowledge that net zero or zero waste targets will not be achieved overnight. Often, these commitments will require a company to embed environmental ethos into their DNA and commit to changing business as usual. Setting ambitious and actionable goals combined with publicly reporting progress is a great way to achieve transparency and remain accountable.
Secondly, companies should consider the economics of reduction at a macro level. When analyzing the entire value chain, there is much more potential to optimize efficiencies and introduce reduction initiatives. BCG reported that full decarbonization would on average only lead to an increase of no more than 4% in end consumer prices.
4% could still be a deal-breaker for companies operating in highly commoditized markets. However, the competitive advantage of becoming a climate leader has the potential to offset the costs through cheaper financing, lower regulatory risks, increased retention, and increased market share. See Harvard’s Rebecca Henderson’s Lipton case study for an amazing example of how broadening sustainability ambitions can lead to increased market share in a highly commoditized market, in this case, tea.
- Third, each strategy should be considered with the lens of holistically minimizing GHG emissions. Our third consideration may appear painfully obvious, but it is actually highly nuanced. Especially when considering plastics, it may seem like the obvious choice to replace your petroleum-based packaging with glass or aluminum. However, when considering the material’s life cycle, the overall emissions of the material may actually be higher. A proper life cycle analysis will help inform ethical reduction strategies.
Seems manageable, but why haven’t more companies taken action to set goals and act upon them? For one thing, many companies still don’t understand the extent or the nature of the problem. Data transparency is the first step toward ethical environmental action. Next, companies must accompany their sustainability strategy with a concrete theory of change.
A Theory of Change
The theory of change that we abide by at Ampliphi and help our clients implement follows the structure: Reduce Where Possible, Optimize Residuals & Enable Systemic Change. While our theory of change is focused on plastics, it can be implemented across multiple sectors.
Reducing and optimizing unnecessary carbon and plastics in a company’s operations and supply chain epitomizes the concept of “upstream climate solutions.” If we are going to make tangible headway toward limiting global warming to 1.5 degrees celsius, companies must begin to prioritize realistic reduction strategies.
Now is the Time to Act
Integrating innovative climate solutions throughout a company’s operations and supply chain presents an untapped opportunity to become a climate leader. By implementing a similar theory of change, companies with relatively small ecological footprints can enable impact on a global scale. And fortunately, this can often be accomplished with a limited impact on final product prices. In many industries, specifically consumer-facing companies, economics are not a significant barrier to achieving sustainability strategies aligned with ambitious targets.
Incorporating upstream climate solutions, however, takes time and research. It requires companies to change the way they approach product design, suppliers engagement, organizational governance, and above all, their company’s environmental data.
At Ampliphi we believe that every company has the obligation and opportunity to protect the planet. Through highly ambitious data-driven action, companies can help lead the charge to take the necessary steps toward making this world a better place than when we found it. If your company is ready to take the next step and reduce the plastics in your operations and supply chain, please reach out to us for a consultation.