Greener Bottom Line Trends #1 – Unlocking Cost Savings from Your CDP Data, Tying Employee Pay to Carbon Reduction and Avoiding Greenwashing Fines

In this week’s Greener Bottom Lines newsletter, I’m thrilled to introduce a new format aimed at continually improving my content to better support your success.?Starting today, I’ll be sending out a “Greener Bottom Lines Trends” post every Tuesday. This will highlight three key sustainable business trends and provide insights on how you can leverage them to create business value moving forward.?

Given the rapidly evolving landscape of sustainable business, I believe this change will enhance the content and better position you to achieve both your individual and company goals.?

Rest assured, I’ll still deliver in-depth weekly posts that explore sustainable operations, supply chains, and innovative strategies for increasing profits while making a positive impact. This adjustment means you’ll receive more content: a concise weekly highlight to kick off your week, followed by a detailed deep dive on a specific topic. My goal is to share practical tips each week to help you and your team take actionable steps toward improving your environmental impact while boosting profitability.?

I’d love to hear your thoughts on this new format and any future topics you’d like me to cover. Please share your feedback in the comments below. Here’s to sharing expanded ideas and building greener bottom lines together!?

Unlocking Cost Savings from Past CDP Survey Response Data ??

Unless you work in your company’s sustainability department, you likely haven’t seen, contributed to, or reviewed past CDP survey responses and associated scores. The CDP (formally the Carbon Disclosure Project) is an annual survey that includes responses from over 21,000 global companies, with about 80-percent of the S&P 500 participating. This survey, scored from A to F, encourages corporate sustainability efforts.?

The latest CDP survey has grown to over 100 questions, and as many Fortune 500 companies have participated in recent years, expectations from B2B customers and institutional investors are rising. They now expect more detailed responses, fewer skipped questions, and greater substance.?

Traditionally, CDP surveys focused on greenhouse gas emissions from energy use. However, an increasing number of companies are now required to disclose data on water, biodiversity, plastics, and forests. Despite stakeholders’ growing awareness on these important topics, only 4-18% of the 23,202 respondents addressed these additional sections in the 2023 survey. However, response rates for these newer topics are expected to rise to 10-40% in 2024.?

Notably, CDP has introduced survey sections on water and plastics, both critical areas that highlight corporate activities and opportunities for improvement. The aim is to reduce water usage from freshwater sources by collecting volumetric data and intensity metrics, while also addressing single-use plastics to protect ecosystems and promote circularity to minimize landfill waste.?

Operations professionals in manufacturing, facilities, purchasing, packaging, and logistics can gain valuable insights by reviewing their company’s recent 2024 CDP responses, as well as those from previous years. This data reveals numerous opportunities for continuous improvement. For instance, OrbAid recently partnered with a Fortune 500 corporate leader to consolidate their past survey data and identify practical projects aimed at optimizing energy use in manufacturing and reducing plastic packaging waste. The best part? This process required no upfront effort; OrbAid simply analyzed their completed survey responses and pinpointed sustainability projects that not only lowered their environmental impact but also increased their business profits.?

Tying Employees Pay to Carbon Reduction to Improve Results?

Mars Chief Sustainability Officer Barry Parkin emphasized in the Wall Street Journal that the key to their success in reducing emissions has been linking executive pay to sustainability targets.?

The company is on track to achieve a 50-percent reduction in emissions by 2030, having already cut its carbon footprint by 16-percent since 2015 , all while experiencing 60-percent business growth. A significant strategy has been tying 20-percent of executive compensation to sustainability objectives, highlighting the importance of these goals alongside financial targets. In 2023, Mars achieved an 8-percent reduction in emissions while addressing substantial Scope 3 emissions by transforming its supply chains. The company is investing over $3 billion in climate initiatives, underscoring?the business value sustainability can deliver as a core part of its overall business strategy.?

Leaders are eager to boost employee engagement and motivation to take on sustainability projects above and beyond their current workload. However, many face the challenge of aligning desired behaviors with rewards for small sustainability actions, which may take time to show results. While these projects provide significant environmental and financial benefits, their full impact can take years to materialize.?

Forward-thinking companies like Mars are adopting the proven strategy of incentivizing desired behaviors. To meet mid- to long-term goals, businesses need to find ways to quantify and reward frontline managers for their contributions to sustainability initiatives. Leaders should take action now to complement top-down incentives with bottom-up approaches, minimizing the risk of falling short on emissions reduction targets.?

Avoiding Greenwashing Fines by Sharing the Journey?

It was only a matter of time before a prominent Fortune 500 company faced scrutiny from the SEC on the green front—enter Keurig Dr. Pepper (KDP). The company has agreed to pay $1.5 million in penalties after the SEC charged it with making misleading statements about the recyclability of its popular K-Cup single-use coffee pods. The SEC notably cited KDP's failure to provide transparent sustainability reporting in its 10-K and 10-Q filings, as required by Section 13(a) of the Securities Exchange Act of 1934.?

Despite the fine, this shouldn’t be seen as an indictment of KDP; rather, they are actively working to lower their carbon footprint, reduce waste, and eliminate plastic packaging. The SEC's penalty highlights the importance of balancing the promotion of ambitious sustainability goals with the realities of current operations.?

In KDP 's case, while K-Cup coffee pods are technically recyclable, the lack of acceptance by many recycling facilities needs to be addressed transparently. Sustainable apparel leader Patagonia offers a strong example by acknowledging both their successes and ongoing challenges. Sustainable business is a journey, not a destination, and it’s crucial to recognize the bumps along the way to effectively mitigate regulatory risks.?

Want more ideas for reducing emissions and costs? ?

Unlock higher profits with OrbAid by discovering sustainability projects that have already benefited your competitors. ?

With no need for upfront data sharing, you’ll receive valuable insights from day one, empowering quick decision-making and executive support. Start your free trial today and become a corporate climate hero while building a greener bottom line!?

For more information or to access OrbAid, reach out to our Customer Success team at [email protected] or call 1-877-7-OrbAid.?