Measuring a legacy:
carbon footprint or carbon handprint?

written by Michael Pooley, 18th June 2024, in CEO Insights

Everyone leaves a legacy. You may not leave a big enough one to change the course of history, but you can certainly make a lasting impact on the environment. This is even more true for organizations. What’s the best way to measure that impact? Carbon footprint or carbon handprint? Or something else?

What is your carbon footprint?

Carbon footprint

What is your carbon footprint?

Carbon footprint — and not carbon handprint — is perhaps the most widely used term to talk about the environmental impact of a product, service, company or activity. Crucially, it highlights the negative environmental impact of the choices we make. Are we right to focus on the negative impact?

A carbon footprint estimates the total emission volume of greenhouse gases — CO2 and other gases in our atmosphere that trap and release heat and contribute to climate change — that are linked directly or indirectly to a product, service, organization or activity. It’s usually measured in tons of CO2 equivalent (CO2e). The carbon footprint is included in every serious decarbonization roadmap and ESG (Environmental, Social, Governance) report. It’s the key performance indicator that external stakeholders will scrutinize most when they are evaluating the "E" in the ESG.

The carbon handprint rarely makes an appearance. Currently, there is still a good reason for this.

The increased importance of the carbon footprint

Over the years, it has become easier to reliably measure the carbon footprint of a product, service, organization or activity. There are widely recognized reputable standards that organizations can follow and meet, which are equally accessible to customers and consumers.

Take for instance the Greenhouse Gas (GHG) Protocol. It’s one of the most common greenhouse gas accounting standards that is used globally. Established in 1998 by the World Business Council for Sustainable Development and World Resources Institute, two organizations that have long promoted sustainable business practices, the GHG Protocol introduced the categories that we now use for measuring carbon emissions.

Most organizations focus on three:

  • Scope 1 emissions, which cover direct emissions from operations owned or controlled by a company,
  • Scope 2 emissions, which cover indirect emissions from purchased energy, such as electricity or steam,
  • Scope 3 emissions, which cover all other indirect emissions generated in the value chain, including from transport or waste.

Why every company should know its carbon footprint

Going into such granular detail on the carbon footprint helps organizations understand their full value chain emissions and helps them to plan and implement initiatives that have high decarbonization potential in the areas where it matters most. The ones that have the greatest negative environmental impact.

As national and international regulations continue to set stringent rules on carbon reduction measures, no company can ignore how their business decisions can have a negative environmental impact. Reducing scope 1, scope 2 and scope 3 emissions is a commitment that organizations need to make.

So where does carbon handprint enter the equation?

What is your carbon handprint?

The carbon handprint is still very much a novel concept. Essentially, the carbon handprint shows how much GHG emission reductions a consumer/customer can achieve by using a product or service that respects the environment over one that doesn’t. Companies could use the concept of the carbon handprint to highlight that their climate-friendly products or services can reduce the carbon footprint of others.

The impetus for the carbon handprint came from two research organizations in Finland, LUT University and the VTT Technical Research Centre of Finland. In their words, "a carbon handprint is the reduction of the carbon footprint of others."

How do you best measure your carbon handprint?

The difficulty with this concept is that there are currently no internationally recognized standards to measure the carbon handprint, only guidelines. If a concept is hard to measure accurately, fairly and in a transparent way, it’s unlikely to be implemented on a broader scale.

Interestingly, the guidelines for measuring carbon handprints build on ISO-standardized life cycle assessment (LCA) methods. They extend the scope by comparing the environmental impacts of one solution against an alternative baseline solution. If the offered solution decreases the footprint of its users, a carbon handprint is created. In effect, companies that can show that they are reducing the footprint of others as well as their own have a positive carbon handprint.

To my mind, this is exactly what an independent, peer-reviewed comparative LCA is already exceptionally good at demonstrating. In our case, they confirm how a circular business model and pooling system for packaging goes beyond reducing our own carbon footprint. It ensures that our customers can also reduce theirs.

What are scope 4 emissions and avoided emissions?

While carbon handprints may need some time to become an established concept, there is another similar concept that is slowly gaining in importance, but it is no less complicated. And it’s the measuring of scope 4 emissions, or "avoided emissions".

The World Resources Institute, which developed the GHG Protocol, describes scope 4 as covering "emission reductions that occur outside a product’s life cycle or value chain but as a result of the use of that product." Which sounds very similar to the concept of the carbon handprint — and LCAs. (Only scope 4 emissions have been around for longer than the carbon handprint idea.)

Scope 4 are therefore the emissions reductions enabled by a company. They are the "avoided emissions" that someone would have generated if they had used a different, less climate-friendly product. The simplest example is the one of a laundry detergent that is effective in cold water. Anyone who uses this kind of detergent can run the wash cycle on a cold setting, thereby avoiding carbon emissions from heating the water. Consequently, all things being equal, the company that produces this kind of detergent has a positive carbon handprint because their product reduces the consumer’s carbon footprint.

Another example would be replacing inefficient incandescent bulbs or fluorescent lights with LED lighting. The manufacturer of LED lights is helping the user to cut greenhouse gas emissions, and these savings could be reported as scope 4 emissions in the manufacturer’s annual sustainability report, for instance.

carbon footprint

Avoided emissions and reusable packaging containers

The same is true of the avoided emissions achieved by our customers through using the IFCO SmartCycle pooling system and our 100% recyclable, reusable packaging containers (RPCs) instead of single-use packaging in the fresh grocery supply chain — or expanded polystyrene boxes for transporting fish and seafood.

In our case, the avoided emissions and environmental benefits of the IFCO SmartCycle and our RPCs have been scientifically quantified via third-party, peer-reviewed comparative LCAs and separate food waste studies. These studies provide comprehensive data on the cradle-to-grave environmental savings achieved through switching from single-use packaging to IFCO RPCs and our circular pooling system. This is why we are also in a position to issue credible IFCO Sustainability Certificates to our customers.

Avoided emissions and the Science-Based Targets initiative

Interestingly, avoided emissions cannot be counted towards near-term or long-term emission reduction science-based targets, according to Science Based Targets initiative (SBTi). The SBTi guides businesses in the setting of credible science-based targets in line with current climate science and the 1.5°C trajectory recommended in the Paris Agreement.

In the net-zero standard guidelines, the SBTi recommends keeping the publication of systematic and validated reduction targets for scope 1, scope 2 and scope 3 emissions separate from any communication around scope 4 emissions. They should be excluded from any reporting on net zero targets or roadmaps.

In IFCO’s case, we also keep our near-term science-based targets for 2031, which are aligned to a 1.5-degree scenario and independently validated by the SBTi, separate from our LCA publications. For the sake of transparency.

What should we be measuring: carbon footprint or carbon handprint? If a carbon handprint can help consumers understand the environmental impact of their choices, then can’t it be a force for good? In many ways it probably is. But by focusing on the positive impact of a product on the environment is there also a danger that companies can use it to try to blur — or greenwash — their negative impact?

What’s important right now is that companies recognize the climate crisis is a serious challenge. By all means, focus on the positive environmental impact of our actions and celebrate our successes. But we must never lose sight of the goal, and that’s to stop our climate from going above two degrees. Because that has profound consequences.

Until there is a recognized standard for measuring and comparing carbon handprints, for reasons of transparency, I expect most companies who are serious about tackling climate change will continue to measure their carbon footprint and conduct third-party, peer-reviewed life cycle assessments to scientifically quantify their environmental impact, both positive and negative. We need to be aware of both.

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