DOCUMENTS AND REPORTS

Factoring in environmental health issues facing businesses – October 2019

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Factoring in environmental health issues facing businesses

The globalization of the economy and the mass distribution of consumer goods have had the effect of lengthening value chains, making product traceability and knowledge of the composition and impacts of each component and substance both difficult and essential.
Eighteen EpE member companies wished to share in this publication their methods, practices and solutions for managing environmental health issues. Experts clarified the discussions and sharing of best practices.

  • The first section of this publication puts in perspective the factors that encourage businesses to integrate environmental health issues into their strategy and throughout the lifecycle of their products and services. It will explain in detail:
    – The increasing societal expectations on the emerging issues of water, air and soil pollution facing businesses.
    – The risks of a crisis and a disruption in production to be anticipated.
    – The potential opportunities associated with a proactive approach. Some EpE member companies systematically integrate health and environmental risks as soon as they establish their research directions and especially explore innovations that promote health.
    – Finally, anticipation and evolution of the law in a complicated legal framework due to the interdisciplinarity of the topic.
  • The second section describes three types of methods and management tools regarding environmental health risk:
    – The first actions to address these issues are tools for analysing and measuring risks to be prioritised in environmental health.
    Employees awareness is another tool of risk management. It involves embedding health and the environment into corporate values and adopting risk reduction tools beyond what is required by regulations.
    – Finally, external communication through existing and non-existing tools is one of the keys to restore trust between health actors and to develop collective solutions.

«DEMAIN La neutralité carbone» special issue based upon the data of the ZEN2050 study

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Demain La neutralité carbone

Special issue based upon the data of the ZEN2050 study

A collaboration with the magazine We Demain, this attached file of the September issue, shows what is currently the meaning of neutral-carbon for each of us and interviews several persons, civilians, politicians and company leaders in regard of the study’s conclusions:

  • Fred Vargas, author ;
  • Ronan Dantec, senator EELV de Loire-Atlantique ;
  • Jean-Dominique Senard, Renault Chairman;
  • Jean-Laurent Bonnafé, CEO of BNP Paribas and Chairman of EpE.

The approach : commissioned by a group of companies and with their input, EpE led the ZEN 2050 study to explore the feasibility of carbon neutrality in France by 2050, which means an unprecedented reduction of our greenhouse gas emissions (GHG) and the balance of residual emissions by absorption through carbon sinks (forests, soil, industrial process). This study has been monitored with the support of a group of experts, academic experts, business and civil society stakeholders. The results of this study are available on EpE website, here.

ZEN 2050 – Imagining and building a carbon-neutral France – July 2019

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ZEN 2050 – Imagining and building a carbon-neutral France

Commissioned by a group of companies from all sectors, the ZEN 2050 study explores the feasibility of carbon neutrality in France by 2050, in terms of the balance between emissions in metropolitan France and absorption through carbon sinks.

It identifies a number of conditions for a successful transition, and concludes with proposals for short-term actions that ensure the transformation remains economically and socially viable.

What approach? The methodology of the study, after reviewing existing studies, consisted in the convergence of two parallel projects:

  • A definition of carbon neutrality by 2050: what role would carbon sinks play? How would emission reductions required for neutrality be shared between economic sectors?
  • A sociological review of lifestyle changes conceivable by 2050, consistent with and respectful of France’s diversity.

Upon completion of these two projects, the study focused on transformation pathways towards this goal, and on the consequences for employment and investment in the sectors most directly affected.

The next stage consisted in identifying and describing in detail some of the conditions necessary for the success of these pathways.

The last stage of the study consisted in drawing up 14 recommandations for all actors on the short-term actions to be taken to ensure that 2050 neutrality compliant pathways remain within reach.

Circular economy indicators for businesses – February 2019

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Circular economy indicators for businesses

According to the United Nations Environment Programme, the total consumption of resources could more than double between 2015 and 2050, putting the planet’s capacities under immense pressure. The circular economy offers a response to this situation in the form of new models, which aim to improve the management of resources by using and reusing them as efficiently as possible, thus reducing waste production and the need to extract raw materials.

Meanwhile, more and more businesses are exploring new business models that incorporate the principles of the circular economy. These businesses need an increasing number of indicators to measure their degree of circularity and its effects on the environment, to guide their approach and strategies. Faced with these challenges, the members of Entreprises pour l’Environnement (EpE) and the Institut National de l’Economie Circulaire (INEC) initiated a project for circular economy indicators in business. Several joint working groups collected the experiences of member businesses. This publication draws on that project, as well as about 22 case studies, to illustrate possible solutions to these questions in concrete terms.

The first section of the report describes the reasons that prompt businesses to measure their circularity and answers fundamental questions, namely the how, why and for whom of assessment. The second section draws on a review of existing work on the topic to identify available tools and outline their limitations in the business world. The third section presents an analysis of the indicators used by EpE and INEC member businesses. The fourth section combines the previous elements to offer simple recommendations for selecting the circular economy indicators that are best suited to each business and purpose.

KEY MESSAGES :

The circular economy and businesses

The circular economy offers a means of rising to major environmental challenges throughout society. For businesses, the circular economy also helps reduce environmental, sourcing and regulatory risks throughout the value chain that can impact a business’s image or operations, while boosting value creation via differentiation and innovation.

An increasing number of businesses are embarking on circular economy initiatives and, as a result, need indicators to measure their impact.

Current metrics

As the situation stands today, there is no recognised method for measuring how effectively a country or business is transitioning to the circular economy, nor are there holistic tools to help guide the process (European Environmental Agency, 2016).
The organisations and researchers focusing on circular economy indicators have primarily conducted work at regional or product level—business-level studies are few and far between. (p 36 Current possibilities and limits of tools available to businesses).

The product-based approaches are useful for managing and promoting a product or product range. However, these indicators rarely account for all the business’s impacts (sourcing and office operation, for example) or the use of its products (such as pooling and sharing), and do not measure its contribution to overall progress toward a circular economy.

Analysis of the indicators used by businesses

To produce this analysis, a survey of EpE and INEC member businesses was conducted on about 40 sustainable development reports, from various sectors, which identified over 160 indicators. The key knowledges from this analysis:

  • Businesses are already implementing a wide variety of indicators selected based on their strategy, existing practices, business sector, area of activity, resources measured and environmental targets.
  • The indicators identified mainly focus on information related to waste (60%) and, to a lesser degree, products and product use (eco-design, lifespan and share of sales).
  • Operational indicators are frequently used compared to financial indicators.
  • The environmental impact indicators gauge the consequences of business operations and the shift toward circular approaches.

Recommendations for businesses on developing indicators

Better than a rigid framework, EpE and INEC offer an approach to enable each business to identify the most relevant indicators for them:

  • Identify the business’s materials priorities by studying its operations, resources used and the various steps – both current and potential – in the lifecycle of its products and services;
  • Ensure that the indicators are tailored to the business’s strategy and update them over time;
  • Select a set of indicators that represents the relevant aspects of the circular economy and pinpoint the types of rebound effects that may curb the positive impact of circularity;
  • Stimulate employee engagement and involve stakeholders while developing the indicators and ensure they are properly incorporated into operational processes.

The environment in dialogue with consumers – December 2017

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The environment
in dialogue with consumers

“The way companies communicate toward their customers is a key factor. It is the most influential force when it comes to changing people’s lifestyles, as family and school education tend to play a more traditional role, reproducing the system we already live in.”
Jean-Dominique Senard, Chairman of EpE, Chairman of Michelin

The way a company communicates to its consumers is crucial to its business activities, and is the subject of countless studies and innovations. Entire advertising departments are rising up to this challenge, as are customer service management teams, marketing departments and salespeople,
to name a few. So why should sustainable development departments also be contributing to this pool of expertise which is constantly being renewed?

The answer: because of the environment, of course.

However, consumers do not like others interfering with how they consume. They do not want to harm the environment but refuse to be forced to protect it – they have so many other priorities!
They therefore rely on companies to manage this topic for them – and if possible without disturbing them – by finding other ways to satisfy their consumer needs. Whether it is through new products, product quality or a product’s life cycle, everything can indeed be produced in a more or less
environment-friendly way.

In this context, communicating about the environment towards customers can often be difficult or even risky – what should be talked about, and how? Will sales increase as a result? What are the risks in doing so?

The difficulties are very real:

  • Environment has many sides and issues, and if a company raises one particular subject, it may also be asked about others: is a product that is good for the climate also good for biodiversity? Does it pollute more?
  • When it comes to the environment, everything is relative, and all those involved are making progress, so at what point can one claim to have an environmental advantage?
  • While the tone of consumer communications is generally positive, mentioning the poor state of the environment may in fact deter people from spending, instead of encouraging them, since such communications can appear to be sanctimonious or finger-pointing, and may therefore lead to rejection.
  • Talking about the environment is technically difficult if the aim is to be rigorous, since specific research is needed. It is also necessary to continuously adapt to the increased knowledge people have of the subject.
  • Above all, various studies, and the experience of many salespeople, show that environmental benefits are rarely decisive when it comes to buying something, for consumers mainly make their decisions based on other criteria, such as price, social, status, and the impact on their health. So why would companies try to overcome such difficulties if the end result doesn’t stimulate sales?

A key evolution is the level of knowledge and awareness the general public has about environmental issues, both of which are growing. Biodiversity erosion and climate change have become common subjects of conversation and concern. While some feel helpless in front of these global problems, many feel that companies could find solutions, and that it is up to them to resolve these issues.
There is therefore a growing societal expectation for companies to offer products with less of an environmental impact, and to provide solutions without consumers having to change their purchasing habits or their lifestyles too much.

For a company, talking about the environment to its customers can then become a way of meeting this expectation and can be beneficial, either because it reduces certain risks or because it leads to new opportunities. It is in any case a sign that the company is assuming its responsibility towards the environment. It is also necessary to approach it in a well-constructed way, with wellchosen tools and an appropriate tone, while meeting expectations that are often unformulated or contradictory, and aimed at audiences with varying levels of interest and receptiveness.

The purpose of this publication, which is based on the experiences of EpE members that have worked on these issues, is to provide some answers to the two questions of why we should communicate about the environment with consumers, and how we should do it.

act4nature – Companies’ commitments – july 2018

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Act4nature is an initiative launched by EPE (Entreprises pour l’Environnement) and a number of partners with the aim of mobilising companies to protect, promote and restore biodiversity.

Scientists, economists and public authorities agree that there is urgent need to act by leveraging the resources commanded by key players to deliver concrete solutions now and in the medium and longer terms.

This initiative aims to develop international collective momentum, driven by committed CEOs in all industries, followed by their colleagues and the public at large.

In joining act4nature, businesses undertake to include biodiversity in their global development strategies so as to help achieve the biodiversity targets set by the international community.

The first commitments were published on July, 10th 2018 during act4nature launch event. First report in 2020!

To read the companies’ individual commitments and download the booklet, visit the website www.act4nature.com/en.

Avoided emissions – March 2018

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Avoided emissions
Companies assess their climate solutions

Transition, companies and avoided emissions
Companies are increasingly taking climate issues into account in their strategies. Beyond a reduction of their own greenhouse gas emissions, they are positively contributing to energy transition by offering low-carbon solutions, i.e. products, services, projects or investments that enable their customers to reduce their own greenhouse gas emissions.
Assessment of companies’ direct and indirect emissions has developed significantly in recent years. It enables a company to reduce them, and its stakeholders to better understand current status and reduction strategies.
However, these emission balances do not reflect the potential value of the solutions provided by the company. Calculating and communicating the emissions avoided by a solution enables the company to document its contribution to emission reduction.

Why assess avoided emissions?
The avoided emissions first enable a company to position itself as an organisation that contributes positively to the fight against climate change. The company thus produces climate change reports that go beyond its impacts and extend it to its influence on other stakeholders, and especially its customers.
This information then allows investors, shareholders and insurers to better understand how the company addresses the climate change issues. They are paying an increasing amount of attention to this topic and expect economic actors to progressively build plans towards a low-carbon future.
For customers, knowing the emissions avoided by their decisions makes it possible to integrate climate change into their purchasing criteria and their investment decisions.
They are a useful tool for comparing different offerings, provided that the avoided emissions are calculated using similar methods for each.
At country level, avoided emissions can be useful for assessing the contribution of different sectors towards the 2°C target, and for identifying industrial sectors to be developed or created.

Moving towards increased rigour, consistency and transparency
However, assessing and communicating about avoided emissions can be somewhat risky. Without a robust and shared methodology, the results put forward by companies could seem inaccurate and difficult to compare, if not too optimistic.
Therefore, EpE enterprises have sought to develop clear and common guidelines so that they can estimate and communicate, whenever necessary, the emissions avoided by their solutions.
This document aims to provide increased rigour, consistency and transparency on this subject. Firstly, it defines “avoided emissions” as clearly as possible. It then provides recommendations on how to calculate and communicate about them. These recommendations are collectively built by the EpE member companies, based on joint work and good practice exchanges. (EpE – “Enterprises for the Environment”).
These recommendations cover both assessment and communication of avoided emissions. This work is just a start and, the methods will be refined over time based on experience as well as on the reactions of financial markets and customers.

From A to W. Water Stewardship – March 2018

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From A to W. Water stewardship: the first dictionary launched by EpE

This brochure brings together 50 concrete, pragmatic actions taken by EpE members for sustainable water management. It reflects not only the involvement and maturity of these companies with regard to sustainable water management, but also how they manage to address the issue. The aim is to inspire and mobilise all corporate actors affected by the conservation of this essential resource – water.

 

Companies and Biodiversity : managing impacts on the value chain – March 2017

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Companies and Biodiversity – Managing impacts on the value chain,
a guide for companies to manage their indirect impacts on biodiversity

Figures about the loss of biodiversity are alarming, the turn-around has not happened yet. Human activities are the main cause of the erosion, making it urgent to act at large scale to reduce anthropic impacts. Beyond impacts of a production site, all impacts along the value chain of any company must be considered, from the sourcing of raw materials to end-of-life of the products including transport and use of goods and services.

“This calls for a change in attitude towards biodiversity that EpE members, major corporations in very diverse sectors, have already initiated: the aim is to be vigilant and reduce these indirect impacts, which are massive because of our size, even if they are remote and diffuse. Our experiences, recorded in this brochure, show that the gradual destruction of the living world’s balances is not inevitable, even if the huge shift demanded requires significant resources. Reacting also means providing our employees, partners, suppliers and without any doubt our customers with a motivating and even fulfilling pathway.” Jean-Dominique Senard, Chairman of EpE, President of the Michelin group

This publication is the result of three years of discussion between EpE members, scientific experts and representatives of environmental organizations. It gives an overview of the operational steps towards sustainability and the management of companies’ indirect impacts on biodiversity through the value chain. The brochure draws on some 30 concrete examples to demonstrate the benefits of this broader approach.

Internal carbon pricing – November 2016

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Internal carbon pricing,
a growing corporate practice

Towards a society with “zero net emission”
In the Paris Agreement, signed in December 2015, the international community set itself the ambitious goal of achieving zero net emission before the end of the century, in order to comply with the average global warming cap of 2°C or less, if possible. The transition towards this low-carbon world means rapidly reinventing development in every field, including energy, transport, housing, production, farming, finance and consumption.
Most actors agree that assigning a price to greenhouse gas emissions has an influence on their decisions and is an effective means of encouraging economic decision-makers to invest in clean energy, low-carbon technologies and even in different products and services that meet the same requirements. Government authorities in several countries have already taken decisions along these lines and,
in 2016, 13% of global emissions were covered by a regulatory pricing mechanism. This figure is likely to increase.

What is internal carbon pricing?
Companies are conscious of the risks relating to climate change and the need to transition to a low-carbon economy. They are also aware of the effectiveness of carbon pricing mechanisms and the important role that they have to play in decarbonisation. As a result, they pay close attention to this trend and are even making an active contribution to it, which is reflected in the development of voluntary pricing tools.
An internal carbon price is a value that companies voluntarily set for themselves, in order to internalise the economic cost of their greenhouse gas emissions. It can be used both as risk management tool and as part of a company’s decarbonisation strategy. An internal carbon price can help companies enhance their global strategies to become more resilient to regulatory climate policies and more favourable to emission reductions.
Internal carbon pricing primarily takes two forms:
• A shadow price: which represents a carbon value (determined by the company) that is incorporated into investment decisions and applied to the greenhouse gas emissions generated by projects;
• An internal carbon tax: a levy that companies voluntarily apply to their operations and that increases operating costs depending on the resulting greenhouse gas emissions; the company then uses the proceeds of this tax as it sees fit.

What are the benefits for the company?
Introducing an internal carbon pricing system can offer several benefits to companies by enabling them to:
• Effectively reach established emission reduction targets;
• Protect against risks relating to compliance with future carbon pricing systems imposed by government, or future decarbonisation policies more generally;
• Prepare themselves for future climate policies, which could lead to competitive advantage in cases where these policies influence operating conditions (costs, changes in energy supplies or technical systems, etc.);
• Direct investments to low-carbon technologies more effectively;
• Drive R&D and identify new markets.

How to adopt this approach
Many companies, including those that are members of Entreprises pour l’Environnement, have embarked on this approach in order to effectively reduce their emissions, show their commitment to a low-carbon economy and protect themselves against the risks posed by this transition. Based on their experience in this area, this publication proposes a methodological approach to implementing an internal carbon

pricing programme.