In today's increasingly critical and urgent climate situation, numerous factors are influencing not only individual awareness but also business decision-making processes.
In the corporate world, both customers and investors are growing more attuned to environmental concerns. Measuring your carbon footprint has become a vital tool in developing a strong environmental strategy. Many companies are now calculating their carbon footprint, and here are five reasons why you should do the same:
Reduce your Costs
Measuring your carbon footprint helps identify opportunities to reduce emissions, often related to energy consumption and transportation.High levels of greenhouse gas emissions are typically linked to excessive energy use or inefficiencies. By cutting GHG emissions, you can boost both efficiency and cost-effectiveness. Adopting low-carbon solutions not only decreases emissions but also reduces overall costs.
Comply with Legislation
Starting in 2024, the European Sustainability Reporting Directive (EU CSRD) will apply to companies with over 250 employees, including SMEs and all firms listed on regulated markets, affecting over 50,000 businesses. Failure to comply with these legal obligations may result in a fine of €10,000, with penalties increasing to €20,000 for repeated offenses.
Meet Clients & Investors Expectations
Investors are increasingly asking companies to disclose their carbon footprint and reduction strategies, making it a crucial factor in their investment and partnership decisions. Customers, too, are placing greater emphasis on a company's environmental commitment, which is becoming a key influence on their purchasing choices.
These rising concerns are likely to set a new standard for stakeholders. More investors are focusing on a company's non-financial factors related to ESG (environmental, social, and governance).
Within the environmental aspect (E), carbon footprint measurement is essential in developing a strategy that aligns with investor expectations. Additionally, the SFDR regulation requires financial sector companies to report non-financial data for each of their products and categorise them accordingly.
Strengthen your Reputation
Openly sharing your carbon emissions and reduction targets offers a competitive edge, demonstrating your dedication to environmental preservation.
While this remains an advantage today, it is likely to diminish over time as environmental responsibility becomes the new standard.
Attract and Retain Talent
Having a strong sustainability strategy is also a key factor in attracting and retaining talent. People today are more motivated by the purpose of their work and are increasingly eager to make a positive impact.Successful professionals now prefer companies that align with their own environmental values.
