Carbonzero/CEMARS Certification Proposal

carboNZero certification CEMARS certification (Certified Emissions Management and Reduction Scheme) Proposal for joining the GHG accounting and offsetting scheme

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certification proposal

Contents

Executive Summary

The following document provides a The following information will be brief outline of the benefits for useful for you to vote for the to become acceptance of the attached certified. A well-designed and maintained certification quote. corporate GHG inventory can I note that offsetting our carbon serve several business goals, emissions is optional. If decides not to invest commercial risks by avoiding the full amount, then a CEMARS greenwash, identifying reduction certification would be a first step opportunities and driving toward efficiency, create differentiation in certification with offsetting being the market place, attract well required as last step for skilled and motivated staff and the creation of new business certification. opportunities.

Introduction governments are taking steps to reduce GHG1 emissions through As part of the ’s national policies that include the Sustainability Initiative, did approach Enviro-Mark programs, voluntary programs, Solutions’ carbon or energy taxes, and programme for a meeting and the regulations and standards on subsequent provision of a quote energy efficiency and emissions. for As a result, companies must be certification for able to understand and manage Limited. their GHG risks if they are to ensure long-term success in a For further information please competitive business environment, consult the separate Sustainability Initiative global, national or regional climate document. policies. The following document outlines As concerns over climate change the required investment and grow, NGOs, investors, and other benefits of the certification stakeholders are increasingly scheme. calling for greater corporate disclosure of GHG information. They are interested in the actions Background companies are taking and in how Climate change has come to the 1 GHG – Greenhouse Gas; a gas in an fore as a key sustainable atmosphere that absorbs and emits radiation within the thermal infrared development issue. Many range.

certification proposal the companies are positioned for 3,700 companies, as an relative to their competitors in the approved verification standard. face of emerging regulations. In is now: response, a growing number of companies are preparing - 5 countries stakeholder reports containing - 23 people information on GHG emissions. These may be stand-alone reports - 200+ clients on GHG emissions or broader - 1000+ certifications environmental or sustainability reports. Public reporting can also strengthen relationships with other Corporate Value stakeholders. For instance, companies can improve their A well-designed and maintained standing with customers and with corporate GHG inventory can the public by being recognized for serve several business goals, participating in voluntary GHG including: programs.  Managing legislative risks A reasonable number of major New Zealand companies have  Reduction of commercial already started with voluntary risk of making GHG emission reporting. One of unsubstantiated ’s direct environmental claims and competitors is , who started their  Identifying reduction reporting . business efficiency The  Create differentiation in programme was established in the market place 2001 by Landcare Research New Zealand Limited, owned by the  Recognition for early New Zealand government. The voluntary action. programme is based on over a  Enable entry and exposure decade of research on climate to new clients change, greenhouse gas measurement and carbon Both business and other monitoring. stakeholders benefit from converging on a common It is the world’s 1st internationally standard. For business, it reduces accredited GHG certification costs if their GHG inventory is programme under ISO 140652, capable of meeting different accredited by Joint Accreditation internal and external information System of Australia and New requirements. For others, it Zealand (JAS-ANZ) and recognised improves the consistency, by the Carbon Disclosure Project transparency, and understanding (CDP), the world’s largest GHG of reported information, making it emissions reporting organisation easier to track and compare 2 Greenhouse gases -- Requirements for progress over time. greenhouse gas validation and verification bodies for use in accreditation or other forms of recognition

certification proposal Managing Legislative occurring between European Risks countries and Asian countries. However, while the USA as a HISTORY nation did not ratify the Protocol, many of its states are now While the idea of emission cap- developing cap-and-trade systems and-trade schemes was born in and are looking at ways to link the 1970s and a prototype their emissions trading systems introduced in the US in 1990, it together, nationally and only became of global significance internationally. (Wikipedia, in 1997 with the Kyoto Protocol. Emissions trading, 2012). (Wikipedia, Emissions trading, 2012). OUTLOOK The European Union Emission Following the international Trading Scheme (EU ETS) came discussions about ETS, it can be into effect in 2005. (Wikipedia, reasonably assumed that we will Emissions trading, 2012). be facing a global ETS with credits being traded internationally and Australia passed the Clean Energy that ETS schemes will be refined in Bill in 2011 relating only to major the near future. emitters of more than 25,000 tonnes a year (simplified) The election of a Labour (Australian Government, 2012). government is highly likely to reinstate many of the abandoned The USA has had several attempts sustainability initiatives like Govt3 to introduce an ETS on a national and likely to act more on carbon level, but has not succeeded so far emissions and energy use. (Turin, 2012). AVOIDANCE OF FUTURE RISK Various local schemes have been set into place across many major It is vital for businesses to be cities worldwide. prepared for future challenges. Even when not yet liable under New Zealand introduced a national any ETS, is would be well ETS in 2008, coverings all sectors advisable to avoid being caught and all gas emissions. The without preparation. Measuring transition period for this scheme and managing carbon emissions finished on 31 December 2012 will become vital for future with the waste sector entering the business conduct as legislative scheme on 1st January 2013. penalties may be imposed onto (Wikipedia, New Zealand them. Emissions Trading Scheme, 2012) In the context of future GHG TREND regulations, significant GHG emissions in a company’s value Carbon emissions trading has been chain may result in increased costs steadily increasing in recent years. (upstream) or reduced sales According to the World Bank's (downstream), even if itself is not directly exchange has increased from 2004 subject to regulations. Thus to 2005 by 240% which was itself investors may view significant a 41% increase relative to 2003. indirect emissions upstream or Emission allowance trading is now downstream of a company’s

certification proposal operations as potential liabilities Increasing efficiency that need to be managed and reduced. A limited focus on direct What gets measured, gets emissions from a company’s own managed. Accounting for operations may miss major GHG emissions can help identify the risks and opportunities, while most effective reduction leading to a misinterpretation of opportunities. This can drive ’s actual GHG increased materials and energy exposure. (Greenhouse Gas efficiency as well as the Protocol, 2012) development of new products and services that reduce the GHG impacts of customers or suppliers. Reduction of commercial This in turn can reduce business risks costs and help differentiate in an increasingly Many companies make environmentally conscious environmental claims to stay marketplace. Conducting a competitive in a tough commercial rigorous GHG inventory is also a environment. prerequisite for setting an internal or public GHG target and for “Greenwashing” typically refers to subsequently measuring and marketing and advertising claims reporting progress. (Greenhouse that are based on environmental Gas Protocol, 2012) puffery rather than performance. Experience indicates that many Using less resources and energy claims, even those from means reduced cost long term. sophisticated multinationals, fall Energy prices have increased under the “greenwashing” banner. between 6 and 8% annually in the While such claims may seem to past and there are signs that this make sense over the short-term, trend will continue. (The New they create long-term potential for Zealand Herald, 2011) consumer dissatisfaction, Historically, electricity prices have regulatory challenges, and even increased by 79.8% from 1994 to monetary damages. (Lilienfeld, 2007 with indication for an 2010) exponential trend (Statistics New Technically, this means claims that Zealand, 2012). More recent data appear to be simple and harmless, is not available from Statistics NZ. such as “eco-friendly” and It would seem that it makes “green,” are actually open to economic sense to invest into scrutiny and legal action. Claims energy efficiency, even when that are general or vague are not taking up loans, particularly at low only considered to be level interest rates. meaningless, the US Federal Trade As part of the ongoing certification Commission considers them to be process, deceptive. requires decreasing CO2 emissions Publishing GHG emission reports and reduction in power use is one and being third party main factor to achieve this. independently certified eliminates that risk.

certification proposal Create differentiation in the early adopters of independent the market place certification can use this for their advantage to build brand has been in the reputation. Despite of not pushing market for more than <#> years it in any way, and is a trusted brand. However managed to build their reputation trusted brands have come under not only through their , but also with their procedures and price undercutting. sustainability practice and being Many tender submissions now certified require meeting certain since . It is recognised that environmental requirements and it their marketing potential is a lot is likely that those requirements higher in that regard. will increase in the future. To differentiate and score higher in those tender submissions, being Attract and Retain Quality third party certified in terms of Staff environmental performance can make a considerable difference. A quality workforce is crucial for a The same applies equally for business that wants to achieve private sector clients, where a high productivity and product plethora of “me too” offerings can quality. Attracting and retaining make a selection rather difficult well-qualified, committed staff can and an independent certification be a significant challenge. can score additional points. Employers who offer their workers intangible values in addition to their standard salary package are much more likely to attract and Enhance reputation retain good staff. There can be significant benefits A Study by The Aspen Institute to brand value and reputation for found that MBA students are companies that are expressing more interest in finding environmentally and socially work that offers the potential of responsible. An enhanced making a contribution to society. reputation can help build sales, They also found that “enhancing attract capital and business environmental conditions” was partners, and recruit and retain more important in 2008 than it employees. Multi-nationals such as was in 2002 (Aspen Institute, The Body Shop, Tesco and the 2008). Swedish furniture retailer IKEA, are Another Study found that MBA both well-known not only as graduates would sacrifice an suppliers of affordable, quality average of $13,700 in salary to products, but also as good work for a socially responsible corporate citizens who are company (Ramus & Montgomery, concerned about the environment 2003). and social welfare. (MPDF, 2004, p. 2) Being committed to exceed best practice, looking forward, being EARLY ADOPTION innovative and caring is a Building reputation takes time and message to staff and potential

certification proposal staff that Enviro-Mark Solutions, the certification can deliver. company operating certification, provides networking New Business and other opportunities for Opportunities certified companies to share information and work together. With enhanced reputation and Some of the currently certified differentiation, companies to target, include may well enter into new business . presence in the marketplace. Universities seem to be on the forefront of sustainability to attract In summary - Why Do It? overseas students that in turn increase revenue. From <…> observations it would appear that they are currently cost-benefit orientated and are looking into Final Words sustainability features without investing too much in certification. I am sure that the information However, the University of provided will enable you to vote in Canterbury became CEMARS favour of accepting the certified in 2010 and we can quote and assume that this will trigger more take on a new universities to draw even to stay journey of enhanced recognition competitive. and reduced risk in unstable The market times. Strengthening for the times ahead is companies that have already the focus of this initiative. achieved certification. Many companies who have achieved CEMARS certification are likely to continue on their pathway to carboNZero certification after a period of GHG management and reduction. The list of already certified companies is regularly growing, and it can readily be assumed that those businesses would be interested in obtaining services by similarly certified companies.

Bibliography

Aspen Institute. (2008). Where Will They Lead? The Aspen Institute Business and Society Program. Retrieved August 28, 2012, from http://www.aspeninstitute.org/sites/default/files/content/docs/bsp/SAS_PRINT_FINAL. PDF Australian Government. (2012, January 13). Clean Energy Bill 2011. Retrieved August 17, 2012, from thinkchange: http://www.climatechange.gov.au/en/government/submissions/closed- consultations/clean-energy-legislative-package/clean-energy-bill-2011/exposure- draft.aspx Greenhouse Gas Protocol. (2012, August 21). Corporate Standard. Retrieved from Greenhouse Gas Protocol: http://www.ghgprotocol.org/standards/corporate-standard KPMG Global Energy Institute. (2008, February 04). Building a Business Case for Sustainability . Retrieved from KPMG Global Energy Institute: http://www.kpmginstitutes.com/global-energy-institute/insights/2008/building- business-case-for-sustainability.aspx Lilienfeld, R. (2010, July 14). Greenwashing: How to Avoid the Typical Marketing Traps. Retrieved from Environmental Leader: http://www.environmentalleader.com/2010/07/14/greenwashing-how-to-avoid-the- typical-marketing-traps/ MPDF. (2004). The business case for Sustainability. Business Issues Bulletin No. 70(70), 2. Retrieved August 28, 2012 Nidumolu, R., Prahalad, C., & Rangaswami, M. (2009). Why Sustainability Is Now the Key Driver of Innovation. Harvard Business Review, 1-10. Ramus, C. A., & Montgomery, D. B. (2003). Corporate Social Responsibility Reputation Effects on MBA Job Choice. Stanford GSB Working Paper No. 1805. Retrieved from http://ssrn.com/abstract=412124 or http://dx.doi.org/10.2139/ssrn.412124 Statistics New Zealand. (2012, August 23). Water, wind and kilowatts. Retrieved from Statistics New Zealand: http://www.stats.govt.nz/browse_for_stats/industry_sectors/energy/water-wind-and- kilowatts.aspx The New Zealand Herald. (2011, February 01). Power bills set to rise up to 8pc from March. Retrieved from The New Zealand Herald:

certification proposal http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10703288 Turin, D. R. (2012). The Challenges of Climate Change Policy: Explaining the Failure of Cap and Trade in the United States With a Multiple-Streams Framework. Retrieved from StudentPulse: http://www.studentpulse.com/articles/656/3/the-challenges-of- climate-change-policy-explaining-the-failure-of-cap-and-trade-in-the-united-states- with-a-multiple-streams-framework Wikipedia. (2012, August 13). Emissions trading. Retrieved August 17, 2012, from Wikipedia: http://en.wikipedia.org/wiki/Emissions_trading Wikipedia. (2012, August 09). New Zealand Emissions Trading Scheme. Retrieved August 18, 2012, from Wikipedia: http://en.wikipedia.org/wiki/New_Zealand_Emissions_Trading_Scheme

Appendix A – Quote Appendix B – Terms & Conditions Appendix C – Information Flyer Appendix D – Case Studies