October, being Energy Action Month, presents a perfect opportunity for all businesses to learn about and begin taking action to become more energy efficient. Developing an energy management plan will help your company reduce its energy use, costs, and impacts. 

When I talk with business owners—especially of small or medium sized businesses—about their energy use and impacts, a typical response is:

1. We’re small so we don’t use much energy.
2. We don’t manufacture things so we don’t use much energy.
3. We rent our space so we can’t do much to reduce our energy use.
4. Our greenhouse gas emissions don’t really contribute that much to climate change.
5. All of the above

 
When I ask two follow up questions—how much energy does your company use each year and how much does it cost—very few have even a ballpark guess. One other question I’ll ask, especially to small or startup business owners – what would you do with an extra few thousand dollars to advance your business?
 
Yes, being a sustainability professional often involves being a gadfly and asking a few pesky questions. A core part of the job is to help businesses be more financially successful – spending their precious cash flow on strategic pursuits rather than on unproductive energy costs that don’t contribute to the company’s success. The old adage ‘you manage what you measure’ is just as true today as when it was first spoken and applies to energy bills as well as other inputs and outputs.
 
While a large business can save hundreds of thousands (if not millions) of dollars a year by becoming more energy efficient, smaller companies also have an opportunity to reduce operating costs. While the savings scale may be smaller, the impacts can be priceless.
 
Startup companies—especially those in clean tech or energy sectors—have a unique opportunity to bake in energy efficiency (and other sustainable practices) from the earliest days when cash flow is scarce. Robust energy efficiency has the added benefit of demonstrating management excellence to prospective investors, lenders, customers, and employees.

​The financial benefits from energy efficiency can also accrue to sustainable businesses such as B Lab Certified B Corps, benefit corporations, or other social enterprises. And, energy efficiency has the added benefit of contributing to the company’s commitments on reducing its environmental footprint.  Actively managing the company’s energy use, costs, and impacts, can also help companies be more accountable and transparent with their stakeholders.

1. Learn how much energy the company uses, how much it costs, and what impacts that creates. 
​Gather all the energy bills that the company pays directly to your utilities (e.g., electricity, natural gas, fuel oil, other). Many utilities allow you to download historical usage and cost data into spreadsheet applications. If you don’t already haven an online account, sign up for one. 
​
If your utilities costs are embedded with your rent payment, seek the information from your building owner or property manager.
 
If you can’t obtain the actual data on your company’s energy use, the table below provides some average US energy data to help to estimate your company’s usage and cost. The table below provides the energy use and cost for an average commercial building in the U.S. Note: the building(s) your company leases may not use all these energy sources. 

​For example, if your company leases (or owns) 10,000 square foot of commercial space (e.g., office, retail, warehouse), your estimated annual energy cost is about $19,000 ($1.90 x 10,000). These data come from the U.S. Energy Information Administration’s (EIA) 2012 Commercial Buildings Energy Consumption Survey (CBECS for shorthand), Table C14 (purchased electricity). Table C24 (natural gas), and Table 34 (fuel oil).
 
You can also use the CBECS data to develop a more refined estimate based on the variables of your company’s commercial space (e.g., geographic region, type of building, age of building, number of floors, principal activities). Or, if you have your company’s direct energy usage and cost data, you can use this table (and/or the underlying CBECS data) to benchmark your company’s usage and costs against national averages.
 
If the environmental impacts are also critical to your business mission and/or stakeholders, you can also assess the environmental impacts from the energy used in your facility. The greenhouse gas (GHG) emissions and other impacts are highly variable based on the company’s energy sources, including where any purchased electricity comes from. Developing a precise GHG emissions inventory can be very complex.
 
The U.S. Environmental Protection Agency (EPA) provides a simple tool in which you plug in the company’s energy usage units to roughly calculate the associated emissions. Note: for a building’s energy use, the tool can only calculate units of purchased electricity and natural gas (i.e., no heating oil).
 
The following table shows the results from the EPA GHG Carbon Calculator, applying the CBECS average annual usage for the sample 10,000 building referenced above.

​EPA’s calculator also provides some more tangible equivalents to help contextualize otherwise amorphous figures. For example, 129 metric tons of CO2e is about the same emissions from driving an average passenger car about 315,000 miles.
 
Another visualization technique I frequently use to provide a more concrete illustration of the otherwise unseen emissions: 1 pound of GHG emissions fills 1 exercise ball. And, a metric ton equates to almost 2,205 pounds. So, the energy to light, cool, heat, and power that average 10,000 square foot commercial space spews out about 285,000 exercise balls of CO2e each year.
 
That image alone usually makes me go hunting for wasted energy.

2. Plan, pledge, and reduce your company’s energy use and costs.
Once you know how much energy the company uses (and how much it costs financially and environmentally), you can develop a plan to reduce. Set a goal to reduce and a timeframe (both base year and target year). You can try the always popular “20 by 2020” goal. That means committing to using 20% less energy (e.g., kWh of purchased electricity, and/or therms of natural gas, gallons of heating oil) by 2020 (for example, compared with calendar year 2016).
 
So for the above sample 10,000 sf space, the target would be to reduce purchased electricity use to 116,800 or less kilowatt hours in 2020. The 20% energy use reduction for this space would:

• reduce operating costs by about $3,800 a year, and
• avoid about 57,000 exercise balls of CO2e emissions.

 
Goals can be absolute or normalized on an intensity basis. Two common intensity-based measures that many businesses use are:

• kWh (and/or MT of CO2e) per $ of revenue
• kWh (and/or MTof CO2e) per employee

 
Publicizing your reduction goal provides additional incentive to reach the goal and helps engage support from the company’s partners.

• How you dispose of things: While proper disposal after a product’s useful lifetime won’t directly save your company money, reusing and recycling reduces energy use (and raw natural resource extraction) across the broader society.

 
If your company has already tackled (or has a plan to reduce the energy use in the company’s facilities), you can try more advanced energy and emissions management by assessing and addressing things like energy associated with: employee commuting, business travel, waste management, and the company’s supply chain.
 
And, if the company decides to also measure and reduce the environmental impacts from its energy use, it might make sense to explore renewable and other clean energy options.

3. Engage with your employees (and other stakeholders).
To successfully implement an energy management plan, it’s important to identify roles and responsibilities for:

• Measuring and monitoring energy use, costs, and impacts,
• Assessing and pursuing energy efficiency projects and practices, and
• Setting and achieving reduction goals.

 
Also, once you decide to actively manage your energy use and budget, don’t forget to engage all your employees! They are critical to reducing usage. 
 
One fun exercise is to conduct an energy treasure hunt (and October is the perfect month do to one). These are based on the kaizen practices made famous by Toyota. Kaizen is Japanese for continual improvement. Energy kaizens can be designed to be very comprehensive and technical audits (even lasting several days for larger, more complex businesses) or short, focused, and fun team building (and money saving) exercises.

4. Keep measuring and monitoring (and reporting).
Set a regular schedule to measure the company’s energy use and costs. Most companies will conduct an annual assessment on a calendar year or fiscal year basis. For companies that spend more on energy, a quarterly (or even monthly) check in may pay off. The data collection process may be a bit cumbersome the first couple times, but should become more efficient over time.
 
Be sure to document what energy efficiency steps the company takes. Track the date(s), cost(s), activity(ies), and location(s) of your efficiency action(s) to ensure you can (1) measure the delta from the “business as usual” costs and impacts and (2) share your successes and lessons learned.
 
Most companies will also calculate the GHG emissions on the same cycle and in conjunction with the company’s energy measurement.
 
How your company reports and shares (internally and externally) its energy management activities should reflect the reasons you’ve engaged in the journey. Many of your company’s stakeholders will benefit from learning about your energy efficiency (and any associated emissions reduction) efforts and progress. As stated earlier, investors, supply chain partners, customers, and employees value energy efficiency as a very concrete demonstration of your management prowess.

5. You Too - Companies That Lease!
If your company leases all of its building space and other real estate – don’t fret, you too can and should pursue an energy management plan! The green buildings movement (e.g., spurred by improved state building code requirements, Energy Star, LEED, Green Globes, The Living Building Challenge) is helping to transform America’s building stock. Buildings are becoming more energy efficient and healthier places more conducive to a highly productive workforce.
 
Unfortunately, there are still institutional barriers and disparate incentives between building owners and tenants that leaves many buildings needlessly wasting energy. Usually, it’s the tenant companies who are stuck paying the costs of the inefficiency. According to the EIA CBECS, for example, there’s a clear difference in the energy use and costs between owners and tenants.

​It’s incumbent on and in the best interest of companies that rent real estate to actively engage on the building’s energy performance. Fortunately, there are emerging advances in “green” lease terms that are helping tenants have more of a say in the energy performance of their leased space. And, more and more property management companies and building owners are interested collaborating with tenants to improve energy efficiency.
 
I’ll be posting another article later this month with more in depth information about green leases and how tenants can take more control over their energy costs. In the meantime, give us a call if you are interested in help developing an energy management plan or conducting an energy treasure hunt.

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Thank you for reading this blog post. Here at Corporate Sustainability Advisors LLC blog and on LinkedIn and Medium, I regularly write about organizational, community, and personal sustainability. If you would like to read my future posts then please subscribe via the adjacent link. Also, feel free to connect via Twitter and Facebook.

​{This is the second in a series about a new breed of business striving to be a force for a better world. Here’s a link to the first blog post.}
 
As described in the first post in this series, there’s a movement afoot that is shifting how we view and measure corporate success. The non-profit B Lab launched a platform to certify the best companies (aka Certified B Corporations or B Corps, for short) and is cultivating a community of these companies, their supporters, and other stakeholders. The “B” stands for “benefit”. Several have touted the B Corp certification as one of the highest and most trustworthy standards for socially responsible businesses.
 
The Certified B Corps are companies that want to improve society—by being better for their customers, workers, communities, and the environment—while making a profit. The founders and owners of these companies are intent on building great businesses that are also a force for societal good.  
 
Energizing the pendulum swing away from Milton Freidman’s profit maximization principle, the B Corp movement is leading the charge to shift from ‘greed is good’ to “doing good is good.”  So, who and where are these B Corporations?

​Who Is Eligible to Be a B Corp?
Any type of for-profit company is eligible to become a B Lab Certified B Corp. There are no legal structure (e.g., S corp, C corp, LLC), size, or industry parameters or requirements. If a company is for profit, it is eligible to earn the certification. That said, most B Corps are privately held small or medium sized businesses.
 
Even start-ups (i.e., companies in operations for less than 12 months) can earn a temporary “Certification Pending” designation (steps here). This special designation is good for a 12-month period (versus the normal certification which is 24 months). Since the B Impact Assessment (“BIA” for short) measures policies, practices, and performance from the previous year, start-ups aren’t able to earn the full certification.
 
While multi-national and publicly traded companies are eligible for the certification (see e.g., Etsy, Laureate, KeHE, Natura, Silver Chef), some have faced institutional and practical barriers to qualify. Currently, the process is most suitable to parent multi-national and publicly traded companies of limited size, scope, and complexity. B Lab identifies the following characteristics as most likely to allow a parent multi-national and publicly traded to qualify for the certification:

• Less than 5 industries or 10 countries of operation
• Less than 50 subsidiaries
• Less than $5 billion in revenues

 
Several large companies have also achieved B Corp certification for a subsidiary (e.g., Ben & Jerry’s/Unilever, Plum Organics/Campbell’s Soup, Happy Family/Danone, New Chapter/Procter & Gamble).
 
To address the existing barriers, B Lab has created an advisory council (the “Multinationals and Public Markets,” MPM Advisory Council) to enable the B Corp movement to scale and diversify beyond the current small and mid-sized company core. Apart for seeking certification, multi-national and publicly traded companies actively engage in a number of ways to boost the positive impact business can have on society.
 
Who are the B Corps?
The B Corp movement is growing exponentially. As of late September 2017, B Labs reported about 2,200 Certified B Corps. In its first year (2007), B Lab certified more than 30 companies as B Corporations. After a small dip during the recession years, the number of B Corps is growing fast. So far, 2016 has the biggest class of first time certifiers with nearly 600. Through early September 2017, B Lab has completed the certification process for about 250 new B Corps. 

​The companies in the B Corp movement come from every conceivable line of business, including manufacturers, retailers, wholesalers, construction companies, and service businesses, The following representative list of Oregon companies earning the B Corp certification for the first time in 2017 helps to illustrate the range of companies in the movement.

​The largest segment of B Corps is the professional services companies (e.g., accounting, architecture, consultants, law firms, health care) (about 33%). Wholesale and retail businesses make up another significant swath (about 26%) of the B Corps, And, about 10% of B Corps are in the information and communication technology sector.

​The B Corps represent companies of all sizes—from zero employee sole proprietor LLC’s to 10,000+ employee international corporations. Included in the B Corps ranks are many brand-name companies you’ve heard of---Patagonia, Method, Seventh Generation, Cabot Creamery; and thousands of other companies you haven’t heard of (yet).
 
Beyond the 2,200 or so Certified B Corps, about 15,000 companies have taken the BIA to assess, compare, and improve their environmental and social performance. Some companies take it upon themselves to engage with the BIA. Other companies are invited to take the BIA by their supply chain or other business partners. As a reminder, to qualify for the B Corp certification, a company must score at least 80 points (of a possible 200) on the BIA. According to researchers, there’s about a 7.5 percent passing rate (i.e., companies that take the BIA and later become Certified B Corps).

​The vast majority of Certified B Corps are U.S. businesses. Most states have at least one B Corp incorporated (or having their primary operating location) in the state. A handful of states still don’t have a Certified B Corp (i.e., Delaware, Mississippi, North Dakota, West Virginia).
 
While B Corps are spread across the country, some states are B Corp magnets. The 5 states with the most B Corps are: California, New York, Oregon, Colorado, and Pennsylvania. On a per capita basis, there’s a change to the states with the most (relative) B Corps: Vermont, Oregon, Washington DC, Colorado, and Massachusetts.

Whether on the raw numbers or on a per capita basis, the State of Oregon is home to a sizable chunk of the world’s B Corps (ranked #3 and #2 of US States, respectively). More than 70 (of the 90+) Oregon B Corps call the Portland metro area their home operating base. Later in this blog series, we’ll go into more detail about why Oregon is such fertile ground for B Corps.
 
The Best of the Best!
Each year, B Lab honors the best of the B Corps through its annual “Best for the World” list. These are the companies that score the best on the BIA. B Lab recognizes the “overall” best (i.e., those scoring in the top 10 percent of all B Corporations), along with the best scoring in six other categories (e.g., Best for Customers, Best for the Environment, Best for Community, Best for Workers). Earlier this month, B Lab announced the 2017 list of Best for the World honorees—846 leading companies across more than 50 industries from nearly 50 countries.
 
Stay tuned to this series for more on the B Corp movement wherefore and why’s:

• Why are customers, investors, employees, and communities seeking out B Corps?
• Why (and how) are communities and other stakeholders incentivizing and otherwise encouraging the B Corp movement?
• Why are companies voluntarily choosing to become B Corps?

 
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Nota bene: Companies get newly certified almost every week (and some don’t re-certify). This leads to some fluidity in the numbers. All B Corp data for this article was pulled from B Lab’s website and Data World on September 25, 2017.

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Thank you for reading this blog post. Here at Corporate Sustainability Advisors LLC blog and on LinkedIn and Medium, I regularly write about organizational, community, and personal sustainability. If you would like to read my future posts then please subscribe via the adjacent link. Also, feel free to connect via Twitter and Facebook.

The news cycle feels overwhelming at times. We get barraged with negative stories about violence, corruption, greed, injustice, hate, and massive weather damage.
 
As sustainability professional, I get questions all the time about whether our collective goose is cooked. Is catastrophic climate change irreversible? What can I as an individual do to combat it? How can I do better as a business leader? Do my actions and decisions really make a difference?
 
While my responses may vary depending on the news cycle influences, I’m always able to consistently share hope by highlighting a new type of company and a burgeoning movement of “B Corps”—the better companies that often go by the designation “benefit corporations” and/or “certified B corporations™.” B Lab, the non-profit that started the “global movement of people using business as a force for good™,” has a vision that one day all companies compete not only to be the best in the world, but the “Best for the World®.”
 
I’m old enough to remember when more companies acted with some semblance of a conscience. When they earned a good profit for the owner(s), when they paid their workers a fair wage, when they built lasting relationships with their customers, and when they built enduring products. When they took some effort to minimize externalities and do the ‘right thing’ even if the law strictly allowed them to do otherwise.
 
All before Milton Friedman’s principle of profit maximization at all costs became the prime directive for American business owners and investors. Those old-school businesses weren’t perfect nor always the most efficient, but the most successful took some measure to act ethically and legally—to engage in some level of social responsibility—for the mutual betterment of the owner(s) and society.
 
Don’t get me wrong. I love me some profit. It’s an elemental factor in business motivation and success. But, it doesn’t happen in a vacuum. And, a high profit today, may lead to a business failure tomorrow. To succeed, businesses also require good employees and customers and sufficient natural resources (i.e., raw materials for product-based companies, in the way of energy, buildings, computers, phones for service-oriented companies).
 
Some companies are bringing corporate America back to the future—where the power of business is used to benefit both shareholders and society. Some of these companies are successfully managing to the triple bottom line (factoring people, planet, profit). Some are designing their products to minimize their environmental and other social impacts (e.g., EPEAT electronics, Fair Trade coffee or chocolate, sustainably harvested forest products). Increasingly, some are using more comprehensive reporting frameworks such as the Global Reporting Initiative (GRI), ISO 26000, or the CDP (formerly the Carbon Disclosure Project) that measure corporate-wide practices and impacts.
 
There is also a smaller sub-set of for-profit companies that were launched to advance general or specific public benefits. Some of these do-good, for-profit companies may be called many things—social enterprises, conscious capitalism, benefit corporations, B corps. Some have been around for decades (e.g., Patagonia, Ben & Jerry’s, Stonyfield Farm, Eileen Fisher, Sokol Blosser Winery, Hog Island Oyster Company); others were launched more recently (e.g., Etsy, Warby Parker).
 
If an individual or business is looking to support these trends to redefine business success, how do they go about distinguishing between all these so-called good companies? Many, myself included, think that the Certified B Corporations™ set themselves from the rest of the pack because of the comprehensive, independent assessment and rating process they go through to become and remain certified.
 
I am working, with some collaborative partners, on a series of blog posts about some of these new breed companies. We’ll start by focusing on the benefit and certified B corporation designations.
 
This first article is a basic primer about the “what” (What is a Certified B Corp, What is a Benefit Corporation) and provides a brief history about the movement that introduces the who, why, where, and how Certified B Corps came to be. Subsequent articles will focus even more specifically and deeply on the B Lab Certified B Corporations, including:

• Who | Who can become a Certified B Corporation? Who are these B Corps?
• Why | Why are companies choosing to be (or not to be) Certified B Corporations? Why are stakeholders engaging and supporting these B Corps?
• Where | Where are the Certified B Corps doing business? Where can I find these B Corps?
• How | How does a company become a Certified B Corp? How are Certified B Corps being a force for good and creating benefit for all stakeholders, not just shareholders?

 
Please travel with us as we explore these back-to-the-future companies and discover a movement that may just disrupt capitalism, our planet, and our communities—for the better. Along the way, we’ll feature some data about and conversations with Oregon-based B corporations. Thanks, in advance, for indulging some home-state pride! We come honestly to featuring Oregon B Corps as Oregon is home to a significant percentage of the certified B corporation community.
 

The Basics | What is a Certified B Corporation versus a Benefit Corporation?
Some of the phrasing for this new breed of company has caused some confusion. There are basically two terms to understand and distinguish: “certified B corporations” and “benefit corporations.” Part of the confusion is that the shorthand phrases “B Corp” or a “B” company are being informally used to describe either type of company. My preference is to use the “B Corp” term just for the B Lab Certified B Corporations. Certified B corporations and benefit corporations have a lot in common. A company can even be both. But, the two types can be distinguished by a few key differences.

​In brief, Certified B Corporations™ are companies that have gone through a third-party assessment process (conducted by the non-profit B Labs®) that certifies their social and environmental performance, legal accountability, and public transparency. B Lab frequently uses the following analogy: a Certified B Corp is to business what Fair Trade certification is to coffee, USDA Organic certification is to milk, or USGBC LEED certification is to green buildings.
 
The B Lab assessment process is iterative and evolves to adapt to emerging best practices and standards. The assessment covers the company’s entire operation and measures the company’s impacts across four areas:

1. how a company is governed,
2. how it treats its workers,
3. how it respects the environment, and
4. how a business supports its community.

 
The applicability and weightings in each category are tailored to the company’s industry, geographic location, and number of employees. Under the current scoring system, companies can score a potential 200 points. A company must earn at least 80 points to earn the Certified B Corporation label. They must also re-certify and meet the scoring minimum every two years.
 
Today, more than 2,200 companies are B Lab Certified B Corps. These companies come from more than 140 industries and are from 50 countries. Tens of thousands of other companies have also used the B Lab assessment framework to measure themselves and provide a roadmap to improve.
 
Benefit corporations, on the other hand, are a new type of incorporation category that have a social, environmental, or some other identified public benefit as an integral part of their business purpose and meet the legal requirements established by state laws (where the company is incorporated and/or registered). Similar to S or C corporations, wholly owned subsidiaries, or limited liability corporations, benefit corporations are a legislatively recognized category of company. More than 30 states have enacted some form of benefit corporation laws; many other states are actively considering benefit corporation legislation. 

Typically, these states require their benefit corporations have a stated public benefit and meet higher transparency and accountability standards than the other types of corporations. For example, many states with the benefit corporation designation require such companies to submit to periodic independent third-party assessments and publicly release the assessment results. Unlike other types of incorporated businesses, benefit corporations are legally obligated to consider impacts beyond profit or maximizing shareholder value. They must also consider the impact of their decisions on their workers, consumers, their communities, and the environment. This legal structure enables business owners to support the company’s business and mission while growing over the long-term.
 
New companies can initially file as benefit corporations. Existing companies may also amend their governing documents to change to the benefit corporation structure and re-file with the state to change their legal status.
 
Here is a brief summary from B Labs that outlines some of the intersections and differences between legislatively recognized benefit corporations and B Lab Certified B Corporations. 

A Little History | How the B’s Began
About 10 years ago, B Lab was launched to accelerate the growth and amplify the voice of the socially and environmentally responsible business sector. The founders—Jay Coen Gilbert, Bart Houlahand, and Andrew Kassoy—identified three key elements needed to foment this movement:

• a set of standards that business leaders, consumers, and investors could use to identify “good” companies
• a legal framework that would enable companies to consider all stakeholder interests, rather than just maximizing shareholder value
• a brand and community to unite the various corporate sustainability/social responsibility monikers

 
The first foundational component of their strategy was to create a comprehensive set of best practices performance standards and legal requirements to distinguish and provide credibility to companies portraying themselves as a “good” company.  In addition to measuring what matters, and benchmarking the impact against similar companies, the standards provide a framework for companies to improve their performance.
 
The founders worked with many leading businesses, investors, and attorneys to develop this initial set of standards. What has now become the “B Impact Assessment” started with a spreadsheet to measure some of the best practices in socially responsible businesses. The first 19 companies were certified as B Corps in June 2007.  While most of the certified companies are American companies, companies in many other countries have been certified. Canada has the second most B Corps with more than 150 certified companies to date. By 2011, more than 500 companies had been certified. While companies must pay a fee to be audited and certified, any company can use the B Impact Assessment rating tool for free.
 
The standards for the B Corp certification evolved over the years and will continue to evolve. Moving forward, B Lab will update the B Impact Assessment about every three years. B Lab now uses an independent advisory council to maintain and advance the standards. It always welcomes public comments on the standards.
 
Passing legislation to create a new type of corporation was the B Lab founders’ second piece of infrastructure to spur a more massive and durable movement. B Lab (with pro bono attorneys from Drinker Biddle & Reath) developed model legislation to create a statutorily recognized class of social enterprise companies—the benefit corporations. B Lab, in partnership with many, worked (and continues to work) with states to enact benefit corporation laws. In April 2010, Maryland became the first state to pass a benefit corporation statute. In June 2017 Texas became the 33rd state to create a benefit corporation class. The Texas law is effective September 1, 2017. Six other states are actively exploring benefit corporation legislation: Alaska, Georgia, Iowa, Mississippi New Mexico, and Oklahoma.
 
These social innovators were motivated to create this new type of corporation, in large part, to counter the strong perception and several legal decisions—framed by Milton Friedman’s 1970 business social responsibility article—that protect shareholder profit maximization over all other business and societal interests. These battles over a company’s pursuing its mission versus shareholder’s rights to maximum profit typically arose in the context of potential corporate takeovers or other sales or after leadership changes.
 
The benefit corporation pioneers felt this type of legal structure was needed to ensure “long term mission alignment and value creation.” To protect the mission “through capital raises and leadership changes,” to create “more flexibility when evaluating potential sale and liquidity options,” and to prepare businesses to “lead a mission-driven life post-IPO.”
 
Since this type of corporate class is still relatively new, there are no known court cases ruling on the merits of these protections. One interesting corporate transaction that received some press and many have speculated about—whether Ben and Jerry would have fought the Unilever bid if they had the benefit corporation status protection. To Unilever’s and Ben & Jerry’s credit, Ben & Jerry’s became a Certified B Corporation in 2012, twelve years after Unilever acquired it. 
 
The B Lab founders also understood the need to create a brand and community to both unify and amplify the voice of these like-minded companies and their supporters. B Lab has worked to construct a vocabulary that reflects the shared values of those who believe that businesses can be a force for good. They’ve also implemented a series of campaigns such as “Measure What Matters”, “Best for the World”, and “B the Change”.  B Lab is also nurturing and expanding the community through events and recognition such as the B Corp Champions retreats, B Corp Leadership Development, and the B Corp Ambassadors.
 
Stay tuned for the next article in this series—a deeper dive about what it takes to become a Certified B Corporation and/or a benefit corporation and why companies are voluntarily choosing these routes.

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Thank you for reading this blog post. Here at Corporate Sustainability Advisors LLC blog and on LinkedIn, I regularly write about organizational, community, and personal sustainability. If you would like to read my future posts then please subscribe via the adjacent link. Also, feel free to connect via Twitter and Facebook.

The GHG reps appear in Question 32 (FAR response page 4). The image below is a screen shot from the SAM reps section, after selecting "yes" for the first value (i.e., the company received $7.5+ million in Federal contracts during the prior Federal fiscal year).

The image below is from the most recent SAM Questionnaire for Representations and Certifications  (Reps and Certs user guide) (February 24, 2017).

There is a noted departure between the final FAR rule and how the representation is stated in SAM. The SAM language implies that GHG emissions inventories and goals must be publicly disclosed (for those with $7.5+M the prior Federal fiscal year).  In the final rule making, however, the FAR Council was very clear that they are only seeking information about whether companies are making public GHG disclosures. So, the FAR just requires you to report whether or not you publicly disclose GHG emissions inventories/reduction goals. If you already publicly disclose either an emissions inventory and/or reduction goals, you are required to provide a link to the publicly accessible web site where the disclosure(s) have been made. 

​​If you're new to GHG emissions reporting or goal setting, we can help you navigate these new representations. Give us a call at (888) 807-5237 or email us at info@corporatesustainabilityadvisors.com. 

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Thank you for reading this blog post. Here at Corporate Sustainability Advisors LLC blog and on LinkedIn, I regularly write about organizational, community, and personal sustainability. If you would like to read my future posts then please subscribe via the adjacent link. Also, feel free to connect via Twitter and Facebook.

With so many climate change stories in the news these days, what's an owner of a medium-size or small business to do? There's a lot of talk about what governments and large, global companies are doing to climate-ready their businesses, but fewer tips for smaller businesses.

Owners of smaller businesses face similar risks (and may also have opportunities) from climate-related impacts:

• physical hazards such as increased temperatures, storm events or sea level rise; 
• regulatory changes such as voluntary or mandatory CO2 emissions reporting or green building standards; and
• market changes including energy and other resource cost increases, new provisions to "green" your lease terms, or shifts in workforce and consumer valuation of sustainability practices.

While the scale of these risks is certainly smaller in terms of overall costs/revenue/GDP, the relative risk to each business can be significant,  even making the difference between thriving or going under.  

Here are 5 things any business owner or leader can do to take action on climate change and make their business more resilient. 

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Thank you for reading this blog post. Here at Corporate Sustainability Advisors LLC blog and on LinkedIn, I regularly write about organizational, community, and personal sustainability. If you would like to read my future posts then please subscribe via the adjacent link. Also, feel free to connect via Twitter and Facebook.

Summary
Federal agencies have amended the Federal Acquisition Regulations (FAR) to require certain contractors to indicate whether or not they publicly share information about their corporate greenhouse gas (GHG) emissions inventory or goals. Published in the Federal Register on November 18 (81 FR 83092), the new rule does not actually require contractors to calculate or reduce their GHG emissions, just that they indicate whether they publicly disclose either emissions or goals information.
 
In the final rulemaking the government clarified the purpose and goals of the FAR modifications. The representations are intended to help the government better understand, not regulate, the GHG management practices of its industry partners. The rule is designed to be a low-burden, minimally intrusive effort to enable greater insight into the GHG management practices of the federal supply chain.
 
Effective December 19, 2016, the final FAR rule establishes an annual representation requirement for contractors to indicate whether or not they publicly disclose GHG emissions data and/or emissions reduction goals. For companies that do publicly disclose such information, they must also indicate where it is publicly available on the Internet. The requirements are applicable to companies that had $7.5+ million in federal contract awards in the prior federal fiscal year.
 
The final rule is almost identical to the proposed rule released in May 2016 (81 FR 33192). Some minor clarifications where made to address comments made to the draft rule.

Representations Required
New FAR provision 52.223-22 (and an equivalent at 52.212-3 for commercial/COTS items) representations:

1. The Offeror (itself or through its immediate owner or highest-level owner) [ ] does, [ ] does not publicly disclose greenhouse gas emissions, i.e., makes available on a publicly accessible Web site the results of a greenhouse gas inventory, performed in accordance with an accounting standard with publicly available and consistently applied criteria, such as the Greenhouse Gas Protocol Corporate Standard.
2. The Offeror (itself or through its immediate owner or highest-level owner) [ ] does, [ ] does not publicly disclose a quantitative greenhouse gas emissions reduction goal, i.e., make available on a publicly accessible Web site a target to reduce absolute emissions or emissions intensity by a specific quantity or percentage.
3. If the Offeror checks "does" [under either provision], the Offeror shall provide the publicly accessible Web site(s) where greenhouse gas emissions and/or reduction goals are reported: ___________________.

 
Implications
The new rule may be a target for repeal by the incoming administration because it is based on an Executive Order of President Obama (EO 13693). On the other hand, the EO and rule mirror the supply chain practices of many successful US-based and global corporations. Applying such practices to the US government’s $400 billion supply chain could well have bi-partisan appeal as they will likely result in cost savings to the companies and taxpayers alike.
 
GHG management is closely connected with cost savings from energy use reduction, and serves as an indicator of operational efficiency and excellent management practices.  Thus, organizations that purchase large volumes of goods and services (e.g., AT&T, Bank of America, Coca-Cola, Nike, Walmart) have started asking their supply chain (i.e., the companies they buy from) about these practices.
 
Private and publicly-traded companies are enhancing their environmental, social and governance (ESG) practices, including disclosing details about their GHG management and other sustainability practices through tools such as the CDP and the GRI Sustainability Disclosure Database. For example, nearly 10,000 organizations have submitted more than 35,000 reports via the GRI database. Last year, companies representing more than 50% of the combined market capitalization of the G20 reported emissions data to CDP.  These public disclosures, and the management efforts behind them, help the bottom line. 

• “The strong performance of three-year reporters [to the CDP] is also displayed in the carbon and cost savings in the reporting cohorts…Those reporting for three or more years reported an average savings of US$1.5 million per initiative, versus first-time reporters, which had an average savings of US$900 thousand per initiative.” ~ From Agreement to Action: Mobilizing Suppliers Toward a Climate Resilient World: CDP Supply Chain Report, 2016.

​In response to these efficiency opportunities, supply chain management practices, and investor expectations, many federal contractors already have GHG and energy management programs. This is especially true of the largest contractors. The Council on Environmental Quality (CEQ) just released the 2016 Federal Supplier GHG Management Scorecard that reflects a survey of approximately 80 companies and represents $214+ billion in FY15 federal procurement spending (about half the annual contracted amount). Of those surveyed, about 57% (by count) or 73% (by contracted dollars) have public GHG emissions inventories in 2015 or 2016. 

​Slightly fewer have public GHG reduction goals for 2016 or beyond—about 44% (by count) or 62% (by contracted dollars). 

​Whether or not the new rule remains in effect throughout the next administration’s term, there are compelling business reasons for federal contractors and other companies to manage their GHG emissions and energy use.

The 2016 scorecard about the top federal government contracting companies' greenhouse gas (GHG) emissions and climate risk management activities was released today.  Like other organizations that purchase a large amount of goods and services (e.g., AT&T, Bank of America, Coca-Cola, Ford Motor, Nike, Walmart)), the federal government asks its supply chain about these sustainability practices.

The CDP's supply chain program is a widely accepted portal through which private companies seek information from their suppliers about their GHG management, climate risk, and other sustainability practices and impacts The GSA and Navy also use the CDP.  The CDP supply chain program represents a combined purchasing power of more than $2 trillion US.

Companies (and investors and academic research) have found a close, positive correlation between financial performance from companies with good environmental, social, and governance (ESG) practices. Near the top of the list of environmental programming is GHG management because of its close connection to energy usage and costs. Companies with good GHG management programs and reduction goals can realize significant financial savings--something critical to all federal contractors in these hyper competitive times.  For example, those reporting to the CDP for three or more years reported an average annual savings of $1.5 million per initiative.  First time CDP reporters had an average savings of $900,000 per initiative.

Stay tuned for more in-depth analysis about the 2016 scorecard in an upcoming post.

The federal government's 2016 supplier scorecard is located here.  Does your company have red or yellow scores?  Let us help you get to green (and save some green). 

A dash of this. A dash of that. Like the best dishes, each company’s social responsibility recipe will be slightly different and evolve over time. Creating a recipe from scratch is both daunting and exciting.

The Silicon Valley Community Foundation (SVCF) recently published a helpful guide, Starting With Purpose, about why and how startups should bake in sustainability and other corporate responsibility as an integral part of creating a new business.

Investors, customers, and employees are increasingly seeking out companies that integrate environmental, social, and governance practices into their business strategy and purpose. The nimbleness and innate creativity of new companies provides an optimal atmosphere in which to embed social responsibility practices into the corporate strategy and culture. 

Doing so early can help the business thrive with a triple bottom line: prosperity, people, and the planet. This is especially true for businesses that are built around products or services designed to create positive environmental or social impact such as clean tech, clean and/or renewable energy, and energy management and efficiency companies.
 
Here are six ingredients recommended in the SVCF guide:

• Cultivate a Culture Committed to Social Change
• Connect with Local Communities
• Donate or Discount Products or Services to Drive Social Change
• Lay the Groundwork for a Sustainable Supply Chain
• Translate Diversity Values into Practice
• Make a Public and Formal Commitment to Social Responsibility

 
Does your startup seek to impart social change in addition to generating bottom line profit? We’d love to help you create your secret sauce. For more information on how we can help your company, please contact us at info@corporatesustainabilityadvisors.com. Let’s cook-up something great together.