Last month, TriplePundit founder Nick Aster spoke with Mike Bellamente, executive director of Climate Counts, Mark McElroy, founder and executive director of the Center for Sustainable Organizations, and sustainability architect Bill Baue in one of our weekly online chats. The trio has been working on a new approach to measuring sustainability performance and just released what they call the “world’s first” science-based company rankings.
Released today, the rankings seek to put companies’ self-reported emissions data in the context of GHG reductions called for by climate scientists – scaling this assessment based on market share. Researchers looked at factors such as emissions output and contribution to GDP to assign a company-level carbon budget and determine whether reported emissions are on track with science-based thresholds.
Nearly half of the 100 companies analyzed rated sustainably in the study, with Autodesk, Unilever and Eli Lilly earning the top three spots in the rating. Of the 49 companies that scored sustainably, 25 of those exhibited revenue growth even as their emissions declined, indicating that the decoupling of growth and emissions is possible. Conversely, 51 percent of companies reviewed were found to be emitting unsustainable levels of CO2, researchers said.
While it’s certainly appropriate to applaud top performing companies for their efforts to reduce climate change, it’s worth noting that results are based on companies’ self-reported emissions data, and several big earners are notoriously stingy when it comes to GHG reporting. In its most recent company scorecard, Climate Counts pinpointed Amazon.com, Wendy’s and Viacom as slow adopters of climate strategies, saying, “There continues to be little publicly available evidence to suggest that they are measuring, reducing and reporting their GHG emissions.”
Perhaps even more valuable than the rankings themselves is the methodology behind the report. Using what Bellamente, McElroy and Baue call context-based sustainability, researchers attempt to go beyond comparing companies to other companies by putting emissions data in the context of market share and thresholds set by climate scientists.
“Most of what passes for best practice in sustainability measurement and reporting today falls short of the mark, precisely because it fails to take real social and environmental thresholds into account,” McElroy said. “What businesses need, instead, are science- and context-based tools that bring meaning to measurement.”
By measuring emissions totals against what is viewed as best practice among climate scientists, researchers say these rankings give companies a more holistic look at their climate impact – and executives seem to agree.
“This notion of context-based metrics that integrate market share makes a ton of sense,” said Gretchen Hancock, manager of resource optimization at GE. “Asking if we’re really reducing our emissions faster than we’re growing the business [and testing whether] the broader business community also has the power, creativity and innovation to decouple emissions reductions from economic growth.”
Using scientific data to set carbon targets tends to put companies ahead of the curve when it comes to sustainability. The top two ranked companies, Autodesk and Unilver, have known histories of using a science-based approach to set emissions targets, but most companies aren’t there yet, according to the report. Whether comprehensive, science-based rankings will help companies turn the corner remains to be seen, but it’s certainly a step in the right direction, experts said.
“If companies are ever truly to gauge their carbon performance, it is critical to understand what progress means in terms of science-based thresholds,” said Paul Dickinson, co-founder and executive chairman of the Climate Disclosure Project. “The latest Climate Counts study is a noteworthy step toward that goal.”
Image credit: Context-based sustainability graphic courtesy of the Center for Sustainable Organizations
Based in Philadelphia, Mary Mazzoni is a freelance journalist who frequently writes about sustainability, corporate social responsibility and clean tech. Mary also contributes to Earth911; her work has appeared on the Huffington Post, Sustainable Brands and The Daily Meal. You can follow her on Twitter @mary_mazzoni.